A New Jersey man has sued the owners of a sushi chain based in Bergen County, claiming he invested his family’s life savings and has been treated as a worker rather than a business partner.
Dae Sub Choi, of Tenafly, states in court papers he invested $100,000 in Sushi Maru Express more than a decade ago and was promised he would be treated as a shareholder.
The owners of Sushi Maru Express, based in Ridgefield, did not immediately respond to requests for comment on the lawsuit, filed in Bergen County Superior Court.
In an answer to the lawsuit, an attorney for the business owners called the complaint “spurious and malicious.”
The attorney, Matthew Jeon, of Englewood Cliffs, told NJ Advance Media that Choi loaned the business “a certain sum of money” that has since been paid back. Jeon said the money was a loan to the business, not an investment.
Choi, however, says in court papers he gathered the life savings of his mother in Korea and other family members after spotting newspaper advertisements in December 2011 seeking investors for a lucrative restaurant venture.
In following up on the ads, Choi says he met with two men who each owned small Japanese restaurants. The men said they had an idea for a joint business concept that would bring sushi corners – small, single-worker sushi restaurants – to New Jersey and New York City.
The restaurants would operate as stand-alone businesses inside supermarkets rather than as separate restaurants with costly overhead and operating responsibilities, according to the suit.
The men invited Choi to give them $100,000 in exchange for becoming an initial investor. In return, Choi would receive “proportionate ownership” of the business as it grew, according to the suit.
The owners told Choi they were offering a “life-changing opportunity” in exchange for the $100,000 investment, which would help the business purchase raw fish and other sushi-making supplies, the suit states.
As an added inducement, the owners promised Choi he would be provided a Manhattan location that would be a top-grossing restaurant, according to the suit.
“During the ensuing years and months, (Choi’s) investment clearly resulted in significant expansion of the Sushi Maru Express business,” the suit states.
Sushi Maru Express went from “a handful of locations to more than 120,” the suit states.
However, Choi “received virtually no return on investment, no dividends, an no accounting of the value of his investment,” the lawsuit alleges.
Instead of being treated as a partner, or even a franchise owner, Choi was put to work in several of the restaurants in New Jersey and New York, often being required to be at work before 7 a.m. and stay after the 6 p.m. closing, according to the suit.
Choi “was required to provide car rides to other Sushi Maru workers who did not possess a vehicle,” the suit states.
The lawsuit accuses the owners of the business “commingled money,” awarded franchises to other sushi chefs who paid thousands in “franchise deposits,” funneled money back to Korea, and intentionally operated at a loss to keep money from shareholders.
The lawsuit alleges fraud, breach of agreement, and violations of Franchise Acts in New Jersey and New York.
Jeon, the attorney for the sushi chain, said Monday the lawsuit is without merit and alleged that Choi was never an investor.
“We’re denying every allegation,” Jeon said. “Our position is he filed just to annoy us. He’s wasting our time.”
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