The rise and fall of top chef Mike Isabella
WASHINGTON: Sitting in a private dining room at Arroz, his Spanish-inspired restaurant, Mike Isabella wants to explain his side of the story.
It’s the day before the chef and restaurateur will file for Chapter 11 bankruptcy, and he wants to dispel what he says are mischaracterizations of his company in the days before and after a former manager’s lawsuit accused him and fellow executives of “extraordinary” sexual harassment.
The only thing that stopped the growth of his restaurant empire, he says, was “bad press.” Under the terms of his May settlement with Chloe Caras, Isabella cannot specifically discuss her or her allegations, but by “bad press” he means the media coverage that ensued.
“People stopped giving me a chance,” Isabella says. “And it hurt.”
The affidavit that Isabella would file the following day in US Bankruptcy Court spelled out just how much. Graffiato, his first restaurant in Chinatown, saw its weekly revenue shrink from US$ 50,000 to US$ 5,000.
At the chef’s most ambitious project, the nine- restaurant Isabella Eatery emporium at Tysons Galleria, monthly revenue dropped from US$ 1 million to US$ 300,000, according to Isabella’s affidavit.
Since Caras filed the complaint, the chef has closed more than a quarter of his restaurants. But some investors, former employees and managers say Mike Isabella Concepts was already overextended, launching four places in 2017 alone, including the Eatery, which they say opened with too few staff and too little money.
“The problem is that you’re trying to run this many restaurants,” says Bob Rudderow, a supporter and longtime investor in Isabella restaurants who lost his US$ 100,000 investment when the Eatery closed. “That was well beyond what was reasonable for the staff he had.”
To Isabella, the company was never overextended. “You know why I didn’t think it was too much? Because I had about 20 other ( expletive) deals on the table” before the lawsuit, he said. Eight of them were underway, including plans for more restaurants in the District, as well as in “Vegas, Houston, Atlanta, Philly.
Some of them, multiple projects in a city.” Bankruptcy filings also mention a project in the Middle East.
All of them would have been handled with the same small corporate team – Isabella; Johannes Allender, chief financial officer; Taha Ismail, service and beverage director; Nicholas Pagonis, director of operations; and George Pagonis, corporate chef – and no board of directors.
One investor, who spoke on the condition of anonymity because he’s still involved with Isabella’s businesses, said that whenever investors raised the idea of hiring an executive with multiunit restaurant experience, Isabella would say “he didn’t have the finances to support it, and the investors’ reply to that would be, ‘ That is precisely why you need it’.”
Isabella said he sees value in having a chief executive.
However, he added, “Hiring a CEO is expensive. Very expensive. So you have to be able to afford it first. We talked about it a lot last year. . . . We were definitely interviewing and talking to them. At that point, it was just very hard to give my control up.”
Nonetheless, after the lawsuit, the deals on the table “all went away,” Isabella said. “Everyone was nervous.”
And that was a turnaround for a chef who had no shortage of opportunities in the wake of television fame.
On March 19, Caras’ lawsuit alleged that Isabella and his partners called her “bitch” and “whore,” commented on the size of her buttocks and touched her without permission.
She was fired, she said, on Dec 5 after Isabella told a male sous chef to sleep with her. Caras declined to comment for this story through her lawyer because of her settlement agreement.
“I didn’t call anybody names,” Isabella said, before declining to comment further on any matters related to the lawsuit. He has previously denied Caras’ allegations.
Caras was not the only
People stopped giving me a chance. And it hurt.
woman to allege that Isabella’s restaurants were hostile, sexual environments. At the Graffiato in Washington, a server said that partner Nicholas Pagonis would frequently grab her, and that cooks made lewd gestures at women. Pagonis has denied the allegations.
Hancock, the pastry sous chef for the Eatery, said that Isabella kissed her cheek without her consent, and that working for him was “degrading” for women. Other women alleged that Isabella engaged in harassing behaviour outside the restaurants, too. Isabella has previously denied all the allegations.
Two weeks later, Caras’ lawyers refiled the suit in federal court with expanded allegations: that the company had used broad nondisclosure agreements – covering, among other things, “details of the personal and business lives of Mike Isabella” – to silence employees from speaking out against sexual harassment.
Each breach of the NDA carried a US$ 500,000 penalty. In a previous statement, Isabella said the NDAs were used “to prevent any news about our restaurant openings from leaking to press ... NDAs were absolutely never used to intimidate employees.”
Isabella and Caras settled the suit May 7. Financial terms were confidential, but the settlement included a “binding agreement obligating ( MIC) to take corrective measures, including robust training, and to adopt policies to encourage a work environment free of sexual harassment,” attorney Debra Katz said in a statement.
The chef’s reputation took an immediate hit after the lawsuit. He was disqualified from the RAMMY awards, he lost his concession stands at Nationals Park, and his chef de cuisine at Arroz and Requin at the Wharf departed.
Requin in Merrifield, Virginia, was the first place to close, then Graffiato Richmond in June. By the end of July, Graffiato in Washington had followed.
Hancock said she has conf licting feelings about Isabella’s struggles.
When she heard the Eatery had closed, “Part of me was sort of happy, and the other part of me felt very sad for him, because I think he’s talented and I don’t know if he got lost along the way,” she said.
“I never want to see anyone ever ruined, but I do want to see someone admit their faults and apologise.”
That’s something she said Isabella hasn’t sufficiently done. His response has been “just very machismo and very ref lective of his character in that he was trying to deny and engage in this smear campaign and take no responsibility,” Hancock said. “It was all about deflection.”
Isabella responded that he is “taking full responsibility for everything that has happened.” He said he’s also ref lecting on how his past experiences haven’t always served him.
“I am old school. I did work in a kitchen 20 years ago. It’s a different world,” he said. “Obviously, everyone learns every day. I still learn . . . I’m always learning, and I always want to continue to learn and get better. That’s what it is. Nobody’s perfect in life.”
In the wake of the lawsuit, Isabella said he has made changes at his company. Employees still have to sign NDAs, but their scope has been limited. A no- drinking policy for staff, put in place a year ago, is now aggressively enforced, he said.
When asked what other changes he had made, Isabella read a prepared statement.
“We have instituted new training practices. To see that, you know, the impact” – he paused and sighed – “the detrimental impact such a culture can have on our business and employees, our employees being most important ... It is a people- centred business. And we must put our employees at the top of the ladder always.”
Some other chefs who have faced allegations of sexual harassment in their restaurants, including John Besh in New Orleans, have stepped down from their companies. Mario Batali, who is under criminal investigation for alleged sexual assault, is divesting from his restaurants.
Even though Isabella has not been accused of conduct approaching the severity of the allegations against Batali, some members of the public, judging by their social media comments, may not be eager for his comeback.
Isabella insists he will have one.
“It is going to get harder before it gets easier,” he said. “I’m going to put the work in and the time to get it back to where it needs to be.”
He said he does have regrets. When he’s asked about them, his initial answer is broad and noncommittal. “There’s a million things I regret every day, whether it has to do with work or life or anything,” he said.
But what’s one specific thing he regrets?
“I regret what happened,” he said, his words vague for legal reasons. “For everybody.” — Washington Post
Mike Isabella, chef and restaurateur