Paseo, the popular Seattle sandwich-maker that abruptly closed both of its locations Tuesday, filed for bankruptcy Wednesday.
Records filed in federal court indicate Paseo owed more than $30,000 to various creditors and potentially faced unknown tax debts stemming from a pending civil suit filed by four ex-workers.
Paseo Caribbean Food Inc. filed a voluntary Chapter 7 bankruptcy petition, which generally seeks to pay off creditors by liquidating property assets.
Gloria Nagler, Paseo’s bankruptcy attorney, did not return a phone message left for her Thursday. A call to Lorenzo Lorenzo, the shop’s founder and president, went unanswered Thursday, and his phone’s voice mailbox was full.
Most Read Local Stories
- Coronavirus daily news updates, April 7: What to know today about COVID-19 in the Seattle area, Washington state and the nation
- Coronavirus daily news updates, April 8: What to know today about COVID-19 in the Seattle area, Washington state and the nation
- New UW analysis lowers coronavirus death projections and suggests hospitalizations may have already peaked in Washington
- 'It will not go forgotten': One Seattle business and its tale of two landlords during the coronavirus crisis
- As coronavirus economic effects strain food banks, Gov. Inslee announces statewide food relief fund in Washington
Neither James nor Mary Austin, of Seattle, listed in court records as Lorenzo’s business partners who collectively own about 40 percent of the sandwich company’s stock shares, could be reached for comment Thursday.
Paseo’s bankruptcy filing indicates the sandwich company owes $30,425 to various “unsecured creditors,” including several vendors and utilities and 20 workers or former workers. The filing lists as property assets mostly restaurant equipment — tables, freezers, ovens, meat slicers and other items — valued at nearly $82,000.
The filing also states Paseo has paid more than $251,000 over the past three months in payroll, employee taxes and benefits.
Meantime, gross receipts listed in the bankruptcy filing indicate Paseo garnered more than $2 million in sales last year, with $1.7 million to date this year.
Still, the petition also states Paseo “estimates that, after any exempt property is excluded and administrative expenses paid, there will be no funds available for distribution to unsecured creditors.”
The sandwich company’s declared debts under the filing include about $6,400 in unpaid wages to 16 people.
For four other former employees — workers fired in March who recently filed a lawsuit against Paseo for unpaid overtime and other labor claims — the bankruptcy petition notes a “claim for unpaid wages,” but lists the amount as “unknown.”
The petition lists the sandwich-maker’s largest debts as $10,000 each owed to two wholesale food vendors — Macrina Bakery of Seattle and the Sea Bend Meat Co. of Shoreline.
Reached Thursday, officials at both vendors said they were stunned Paseo had closed.
Scott France, vice president of Macrina Bakery, said his business supplied hundreds of 5-ounce Guiseppe rolls to Paseo daily and noted the sandwich maker was never late with payments.
“We’ve had a good relationship with those folks for a long, long time,” France said.
Stan Ciezc, owner of the Sea Bend Meat that supplied Paseo with pork and seafood, said that whatever money Lorenzo may owe him “is between him and me.”
“We’ve worked with them for 20-plus years now,” Ciezc said. “They’re very, very good people.”
Also listed among its creditors, Paseo’s bankruptcy filing identifies several government taxing authorities, including the Internal Revenue Service and the state’s revenue, employment security, and labor and industries departments.
The filing indicates potential taxes owed to each agency are “to be determined upon resolution of litigation” with Paseo’s ex-employees.
Matthew Erlich, spokesman for the Washington State Department of Labor and Industries, said the agency has not received any complaints from Paseo employees over unpaid wages.
Erlich said he isn’t sure why the agency is listed as a creditor.
A spokesman for the IRS in Seattle declined to comment about the matter Thursday.