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After debt and legal issues, Roberto Donna starts from scratch with Galileo III

By J. Freedom du Lac
Washington Post Staff Writer
Sunday, August 8, 2010; A01

The recipe for opening a successful restaurant generally does not call for stewing in federal court.

But there was Roberto Donna -- the renowned Italian chef who is racing to revive his former flagship restaurant, Galileo, along with his own battered reputation -- in Courtroom 22A at the E. Barrett Prettyman Federal Courthouse in Washington on Wednesday, his brow furrowed, his massive arms folded.

Donna, an outsize figure in the food world whose financial and legal problems have blown up like a souffle in recent years, sat alone at the defendant's table, no longer able to pay a lawyer to defend him. Across the room sat three ex-employees who say Donna violated labor laws and owes them and eight other plaintiffs thousands of dollars each. Theirs is one of a slew of lawsuits, tax problems and other complaints that have hit Donna in the past few years.

"There's this much truth," Donna said angrily weeks earlier, holding his hands just inches apart as he left another hearing at the courthouse, "and the rest is lies."

Donna once cooked nightly for politicos, celebrities, Beltway power brokers and just plain foodies at Galileo and its wildly acclaimed, cutting-edge restaurant-within-a-restaurant, Laboratorio del Galileo, both of which closed in 2006. Galileo was such a hot reservation in the '80s that then-Vice President George H.W. Bush famously couldn't get a table. Lately, however, the chef has spent far more time in law offices and courtrooms than in the kitchen, particularly since his last restaurant, Bebo Trattoria, went belly-up in April 2009 after falling deep into debt, including a half-million dollars in unpaid rent.

Now, the beleaguered James Beard Award-winning chef slouched in his chair as he listened to his former personal assistant and publicist testify about payroll and accounting problems at Bebo, the Crystal City restaurant that closed last year despite having opened to critical praise. "You can point your finger anywhere on the menu," Washington Post dining critic Tom Sietsema wrote in 2006, "and come up with a success story."

At Bebo, former employee Elizabeth Scott said, paychecks bounced, some checks were distributed without Donna's signature, pay periods kept shifting. Earnings were underreported, and employee withholdings weren't sent to the Internal Revenue Service. Donna listened to the litany of allegations and shook his head, apparently in disgust.

In a deposition last fall, Donna, 49, said he is reduced to paying "my expenses to survive." He testified that he was four months behind on his $9,500-a-month mortgage; he owed at least $70,000 on credit cards; his leased Hummer was being repossessed; he'd stopped making $2,000-a-month payments on taxes he owed to the IRS; and he was being sued, "like always" -- this time by a Galileo investor.

At the very moment when Donna was stuck in the courthouse, on the ground floor of an office building just a mile away, contractors worked on what the chef hopes will be his grand comeback stage, Galileo III. After repeated delays, its opening in the 14th Street NW space that once housed the restaurant Butterfield 9 is said to be weeks away.

It might be the city's most anticipated opening of the year, but not merely because of Donna's dazzling culinary skill, which in 1991 inspired Washington Post dining critic Phyllis Richman to write that "Roberto Donna has practically become a national treasure."

Whereas Washingtonians once discussed the greatness of Donna's risottos and house-made pastas, the chatter about him now often centers on his court cases and debts -- for instance, the $157,984.21 he owes to Arlington County, where the commonwealth's attorney prosecuted Donna for collecting meal taxes at Bebo but neglecting to turn them over to the county. Donna pleaded guilty to felony embezzlement in June and received a suspended five-year sentence.

Donna's treatment of employees is at the heart of allegations in two federal cases. In Virginia, five former Bebo workers last year won a judgment against Donna, who was ordered to pay them nearly $25,000 plus more than $17,000 in attorney's fees.

Last month, in the District case involving the wages and tips of 11 ex-Galileo and Bebo workers, Chief U.S. District Judge Royce C. Lamberth ruled that Donna had violated minimum wage and overtime requirements and should be held personally liable.

Lamberth has scheduled a hearing for Aug. 24 on how much to award the plaintiffs, who are seeking $463,948.43 plus legal fees.

Some in District restaurant circles say Donna was never much of a businessman, that his skill was always far greater in the kitchen than at a desk. But others say it wasn't until his empire blossomed in the '90s that his financial controls began to fray.

Donna's own version of events is not yet clear: After agreeing to be interviewed, Donna changed his mind, writing in an e-mail that "A story just before I open a restaurant I think is not fair. . . . Restaurant is already a super difficult business and to want to sabotage it before it opens I think is not the right thing to do to me. I gave all 49 years of my life for cooking!!!!"

He referred questions to attorney Danny Onorato, who represented Donna in the Arlington case. "My goal is to keep Roberto out of trouble and get this restaurant open quickly and successfully so he can meet his financial obligations," Onorato said. "We're trying to get through a dark period for him. These topics just don't help him."

Donna recently told associates that the wages case is "old news" and that he's focusing on Galileo III and a new version of Laboratorio del Galileo. Donna also told associates that he's no ogre, saying: "If I'm a bad boss, how come I have my staff hired?"

'Noise about the tax stuff'

But not everybody is convinced that an opening is imminent. "There's so much noise about the tax stuff and Roberto's other issues that people don't actually think it's going to happen," said Don Rockwell, founder of the free-wheeling Washington-foodie discussion board, DonRockwell.com. "I've never seen a restaurateur fall from grace like this. Roberto was possibly the most important chef in D.C. 20 years ago.."

Bill Miller, the leasing executive who brokered the deal to bring Galileo III to 14th Street, remains optimistic: "Everybody, including Roberto, hoped and expected that the restaurant would have been open by now. Roberto has stubbed his toe umpteen times, but I think everybody will still go to his restaurant once he opens."

Donna's problems are well-known in the business. Twice in the last month, when he posted job openings on donrockwell.com -- for a mixologist and a line cook -- the listings were met with reader comments questioning Donna's managerial skill.

Jeff Chandler, president of American Technology Services, replied to one post, asking Donna to contact him about a bounced check. In an interview, Chandler explained that his company had done IT support work for Bebo and had problems collecting payment. When the company finally received a check from Bebo, it bounced -- twice. "It's small potatoes -- only $270," Chandler said. "In the grand scheme of things, it's not a big deal. But it's pretty annoying and just not good business."

Roberto Donna was born in Turin, capital of northern Italy's Piedmont region, where his parents owned a grocery store and he spent most of his free time playing in the restaurant next-door. He decided before age 5 that he wanted to be a cook; by 13, he was enrolled in culinary school; by 19, he was in Washington, working as a sous chef at Romeo & Juliet, an Italian place on K Street.

In 1984, less than five years after arriving in the United States, Donna and Savino Recine, a colleague at Romeo & Juliet, opened Galileo in Dupont Circle. The restaurant, which barely seated 50 and featured an ever-changing northern Italian menu emphasizing local, seasonal ingredients, was an instant hit, turning Donna into a star well before he hit 25. "He was achieving a quality and a sense of Italian food that we hadn't seen before," Richman said. "It was exciting for Washington."

Soon, Donna presided over a local restaurant empire that included, at various points, Primi Piatti, i Matti, Il Radicchio (multiple locations), Pesce, El Patio, Arucola, Barolo, Cesco and Vivo! But critics concluded that Donna was stretching himself thin, paying too little attention to too many restaurants.

There were also whispers about financial problems -- and they were confirmed in 2004 when Galileo's parent company, SER Inc., filed for Chapter 11 bankruptcy protection in the face of nearly $2.5 million in debt. That included a seven-figure District tax bill that Donna had to address under threat of losing his liquor license.

"You could tell there was trouble," said Tony Spagnoli, who worked in Donna's kitchens at Pesce, Barolo, Galileo and Il Radicchio from 1995 to 2000. "Roberto kept saying, 'Everything's fine.' But I saw it in my own dealings with purveyors who wouldn't accept an order or they'd put us on COD. Or a line cook would come to me and say, 'The bank won't cash my check; they said there's no money in the account.' "

Spagnoli said he once ran an atypical errand as executive chef of Il Radicchio in Arlington: "I had to drive all over D.C. one day picking up bottles of wine from this [Donna] restaurant and that [Donna] restaurant and then take them back to my restaurant because the wine people wouldn't sell us any wine."

Spagnoli quit shortly thereafter "because I didn't want to deal with all the financial issues anymore." He is now executive chef at Pascal's Restaurant and Tavern in St. Michaels. "I have a great deal of respect for Roberto as a chef," he said. "But just because you're a good chef, that doesn't make you a good businessman."

Jordan Lichman was a grill chef at Galileo in 2001 when, he said, the supplier who sold gourmet chocolate to the restaurant "put us on hold because they weren't getting paid. So the executive chef and myself, we went to the Costco in Pentagon City and bought two-pound tubs of Nestle Toll House chocolate chips. This is the 'high-quality' ingredient that was used in the chocolate desserts for a few days."

'Chef' also means 'chief'

Lichman said Donna fired him after four months on the job when he challenged the chef about the legalities of docking pay. Now dean of culinary arts at Stratford University, he places students in restaurants. But not Donna's. "It's not the chocolate," he said. "It's how he's treated employees. He's an excellent cook, but the 'chef' also means 'chief,' and in no way is he a leader. I think he's somebody who is out there for himself and only himself."

Donna's financial problems followed him from Galileo to Bebo Trattoria and seemed to worsen -- particularly after the economy cratered. In addition to the Arlington taxes, Bebo apparently fell behind on state sales taxes: a week after Bebo closed, Virginia's tax department filed a lien against RD Trattoria, Bebo and Donna for $275,762.36.

At the hearing last week, Donna testified that he owes the IRS an unspecified amount of employment taxes from Bebo, covering at least two years. "But I cannot afford to pay them now," he said.

Hemingway once wrote that a man goes broke "slowly, then all at once," and the drip-drip-drip seems to became a gusher for Donna at some point. In a deposition last fall, Donna testified that he'd exhausted his savings and retirement plans and that, with no restaurants open, his only income came from periodic cooking classes he taught at his million-dollar house in McLean. The classes cost $85 to $120 per person, wine included, and were therefore almost certainly in violation of state code prohibiting selling alcohol without a license, according to Philip Disharoon, special agent in charge of the Alexandria division of the Virginia Department of Alcoholic Beverage Control.

Donna said in the deposition that he won't have an ownership stake in the new Galileo III ("I wish," he said) and instead will be a salaried employee earning $50,000 per year. (Donna said his salary at Galileo, where he was majority owner, was $120,000 to $200,000 a year.)

Licensing records show that the new restaurant is owned by RCR LLC. At Wednesday's hearing, Donna's longtime business partner and occasional bookkeeper, Corrado Bonino, who lives in Italy, testified that the chef is his "best friend" and godfather to Bonino's daughter. Bonino said one of his companies owns Mabel LLC, which owns RCR LLC. According to papers filed with the D.C. Alcoholic Beverage Regulation Administration, Mabel's other managing member is Nancy Sabbagh, Donna's wife.

With his felony conviction in the Arlington County tax case, Donna might not have been eligible to secure a liquor license in the District if he'd been made a partner in Galileo III.

Once Galileo III opens and Donna begins to receive paychecks, a long line of people will stake claims on those dollars.

"He seems to have everybody and their brother after him," said Arlington County Treasurer Frank O'Leary, who noted that Arlington has yet to receive a dime from Donna after his conviction. "I almost feel sorry for the guy. But every single one of these problems, he brought on himself. This is not an innocent, good-natured chef who got in over his head. Roberto Donna deliberately cheated people. Now he's getting his just desserts -- and I don't mean Jell-O."

Staff researcher Meg Smith and staff writer Philip Lucas contributed to this report.

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