A New York investor sued Eudora's Mississippi Brasserie and part-owner Carol Carlson for $215,343 on Halloween Day in 2024 in New York Supreme Court (Kings County). The complaint alleges Eudora's borrowed money and pledged future receivables as collateral but soon stopped making payments.
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| Credit: WLBT |
Eudora's Mississippi Brasserie opened at the District at Eastover to much fanfare in November 2023. The members of the LLC with the same name are Tyler Alford, Sarah Alford, Kenneth Carlson, and Carol Carlson.
The complaint claims Eudora's agreed to sell a fixed percentage of its future receivables (sales) in two separate contracts on July 10 in exchange for an investment. Fiji alleges:
8. Pursuant to the Agreements, Company Defendant agreed to have one bank account approved by Plaintiff (the "Bank Account") from which Defendants authorized Plaintiff to make ACH withdrawals until the contracted purchased amount was fully paid to Plaintiff.
9. Pursuant to the First Agreement, Plaintiff remitted the purchase price of $145,000, less applicable fees, for the future receivables to Company Defendant, as agreed for the purchase amount of $217,335.00.
10. Pursuant to the Second Agreement, Plaintiff remitted the purchase price of $40,000, less
applicable fees, for the future receivables to Company Defendant, as agreed for the purchase amount of $59,960.00.
The interest rate was 8.7% in the first contract and 7.5% in the second contract.
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Eudora's and Fiji agreed the bank account would be set up for automatic payments on a predetermined schedule to Fiji. The company agreed to pay $7,762 per week under the first agreement (although it fell to $1,552 per week after six weeks) and $599 per day under the second agreement.
Trouble was soon to follow as Eudora's allegedly told its bank to refuse payment to Fiji, thus preventing it from collecting on the receivables owed. The complaint accuses the defendant of using bank accounts that were not designated in the contract. Fiji provided bank records showing Eudora's account bounced automatic payments several times:
First Agreement Payments
$599 on September 7, 14, 17, 18 in 2024.
Second Agreement Payments
$7,762 on July 24, 2024
$1,552 on September 3, 9, 10, 11, 12 in 2024.
The defendants had paid $83,836, thus leaving a balance of $133,498. Eudora's paid $25,183 under the second agreement. The remaining balance was $34,776. The bill due was $215,343 before attorney's and default fees are included.
Default would be costly for the restaurant as it agreed to pay an interest rate of 16% from default and up to 40% of attorney's fees. Defendant Sarah Carlson Carol Carlson signed both agreements.
The Court denied Eudora's motion to dismiss due to lack of personal jurisdiction.
Fiji submitted a motion for summary judgment to the Court on March 28, 2025. The motion argues the debt is valid since Eudora's sold a share of its future profits to Fiji. Although Eudora's is trying to call it a usurious loan, Fiji says it is a proper investment under New York law. The motion cites several New York cases holding agreements to purchase future receivables are not loans.
Judge Gina Adabi will hear the motion for summary judgment today.
Kingfish note: So much for paying a living wage.
16 comments:
Weinstein is going to get his judgment.
Just a fun fact that in case people were curious - in New York the Supreme Court is the lowest level trial court, not the final court of appeals (and they're the only state in the country with that distinction). Betting the Law and Order junkies are up to speed
Restaurant business is tough. Remember Groupon? They put a ton of places out of business.
somebody borrowed a ton of money and didn't pay it back. imagine that.
happens all the time.
now they sending them carpetbagger new york lawyers down here to prey on the misfortune of us poor southerners.
and to make it worse the restaurant is named after a great southern writer.
my gawd! call out the state militia and start digging trenches in front of the place.
This is another one of those merchant cash advance vultures. Businesses need to STOP taking their bait! They will not rescue your company, they will only accelerate its demise!
iirc, Fine and Dandy stiffed the deveolpers for north of $1M? Good luck trading in that paper for cash Winstein.
And how you know why the place closed - more bad decisions that caused them to live restaurant-poor.
Predatory or not, you signed the dotted line. Unless they didn't show you the terms and 16% interest, this is theft. Just because you're an idiot and have no business sense to realize what you're doing, doesn't make it invalid.
The restaurant biz around here is full of these types. Watch out for the out of towners that come here with their genius concepts thinking they are Gordon Ramsey. It will make a great looking dental office eventually. Bloody Hell!
I'm guessing they will go after the personal guarantors. Then we will see a chapter 13.
Sad demise for such a beautiful restaurant. Too bad the food quality didn’t live up to the place’s design.
I've seen several struggling restaurants fall into this trap. Quick money to keep operations going, but the terms are hell. These companies hook into the POS system and monitor receipts and expect their percentage - sometimes it's daily payments!
No arbitration clause in the contract?
There were actually two reasons the payments to Fiji bounced, at least according to the article I saw yesterday.
Where’s Jess Dickenson when he’s needed? Oh yeah, he’s not in NY
Why in the world would any business surrender thier cash flow?
And why in world would a loan company expect a virgin business to give up that kinda cash weekly and somehow survive?
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