Grace Restaurant Acrimony Continues

Chicago’s elite Grace restaurant has been shuttered for nearly a year, but the acrimony surrounding its implosion continues to be played out in Illinois courts.

Grace closed abruptly in late 2017 amid a dispute between its star chef and owner, who is now suing the chef and former manager/sommelier for tortuous interference and breach of fiduciary duty.

Michael Olszewski, who opened the Randolph Street hot spot with Curtis Duffy and Michael Muser in 2013, claims Duffy and Muser worked at events in far-flung locations around the globe outside of their employment with Grace, ordered and shipped food on the restaurant’s accounts for these events without his permission or compensation to the business, according to the complaint filed in Cook County Circuit Court.

Olszewski’s suit also claims Duffy and Muser “hatched a scheme” to solicit Grace’s employees to leave the restaurant and thereby force its temporary closure, resulting in lost profits and severe damage to business expectancies. The lawsuit seeks compensatory and punitive damages for the harm caused by Duffy and Muser’s “egregious misconduct.”

Duffy’s culinary skills earned Grace three Michelin stars, making it one of only two Chicago restaurants to gain that distinction. Before the establishment closed, Duffy and Muser tried unsuccessfully to buy it from Olszewski. He accused Duffy and Muser of coming and going from Grace as they pleased, in Muser’s case taking spontaneous and unapproved vacations, with increasing frequency.

“Their unexcused absenteeism became a chronic issue, which became a problem for customers who were paying top-dollar for a world-class fine-dining experience and expecting that the world-famous chef and sommelier would be providing them with that experience.”

Following Duffy’s departure along with most of the staff, Olszewski discovered that $10,000 worth of truffles, as well as significant amounts of produce, wine, and wagyu beef, were missing from the restaurant’s inventory, which he alleges Duffy took to work a private event at the Mandarin Oriental Hotel in Miami along with other Grace employees.

He claims Duffy and Muser breached their fiduciary duties to Grace by these actions, as well as “falsely reporting reservations and serving Grace LLC’s food and alcohol to diners without receiving payment,” all resulting in lost revenue, supplies, and personnel in excess of $500,000.

“Duffy and Muser’s frequent practice of giving away Grace LLC’s food and alcohol damaged Grace’s relationships with its actual paying customers by devaluing their dining experience,” the complaint charges. “Duffy and Muser intentionally and maliciously interfered with Grace’s relationships and business expectancies with its employees and [its]customers.”

Duffy and Muser were subject to non-compete agreements which they unsuccessfully attempted to have voided after Grace’s closure. A lawsuit they brought against Olszewski to invalidate the noncompete clauses was dismissed earlier this year, and as a result, the pair is barred from operating a new eating establishment in the greater Chicago area until mid-2019. They have publicly expressed a desire to pursue a new venture together.

This past spring, Olszewski announced plans to open an upscale Japanese-French restaurant in Grace’s former location.

The lawsuit is Grace LLM, LLC d/b/a Grace Restaurant v. Curtis Duffy and Michael Muser. You can view the Complaint in the lawsuit here.

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