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The family-owned diners claim they were forced to file for bankruptcy because of an $837,000 U.S. Department of Labor judgment that was assessed last year for paying workers less than they had earned.
American Classic Broadway Diner in Yonkers and American Classic Executive Diner in Hawthorne filed for Chapter 11 reorganization on May 2 in U.S. Bankruptcy Court in White Plains.
“It is the debtor’s intention to immediately seek mediation and reach a settlement with the DOL that will enable the debtor to successfully emerge from Chapter 11," vice president Gulam R. Khan wrote in an affidavit,
The diners filed bankruptcy petitions under their corporate names, Chrisevan Corp. for the Yonkers restaurant and American Diner Group Inc. for the Hawthorne location.
The American Diner Group, Inc., which owns the Executive Diner at 26 Saw Mill River Road (Route 9A) in Hawthorne and the Broadway Diner at 590 S. Broadway in Yonkers, seeks to reorganize itself under Bankruptcy Court supervision while attempting to pay its debts.
Labor officials accused the company's officers of instructing employees to lie to federal investigators.
On Sept. 27, 2017, Judge Cathy Seibel ordered the restaurateurs to pay $837,356, about half of which was for employee back wages.
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