Lawsuit Over Failed Lucky’s Hot Chicken Expansion Settled
A lawsuit regarding a planned Lucky’s Hot Chicken expansion across the Dallas-Fort Worth area filed Aug. 24 by investors that named Vandelay Hospitality Group CEO Hunter Pond, Vandelay Hospitality Group, and home builder Lou Olerio was resolved by Sept. 1.
In the lawsuit, the investors had alleged Pond, Olerio, and Vandelay raised the $1.8 million and didn’t open Lucky’s Hot Chicken locations as planned, court records show. The investors had sought $2 million in damages, court records show. A notice of nonsuit without prejudice, which allows the plaintiffs to refile the claim later if they choose, was filed Aug. 31, according to court records. Attorney Chris McNeill, who represents Pond and Vandelay, said, “the matter was successfully and amicably resolved to the parties’ mutual satisfaction.”
No additional information is available on what the settlement entailed. Still, following the opening of the original Lucky’s Hot Chicken on Gaston Avenue in East Dallas in 2020, which is the sole remaining Lucky’s location, and a second near SMU that opened in 2021 and subsequently closed, the investors had alleged in court records that Pond and Olerio sought investments to expand in North Texas and planned to open locations in Oak Lawn, Pleasant Grove, Richardson, and Arlington.
The investors alleged that it “was represented to them that these locations had been secured and leases had been acquired,” court records show.
By January 2022, the investors alleged in court documents they’d contributed $1.8 million, and Pond and Olerio had “represented that they would put a total of $200,000 of their own money toward the investment.”
“Almost immediately after the capital had been raised and controlled by Defendants, communication from the Defendants to the Plaintiffs waned,” the investors had alleged in the lawsuit. “Defendant Pond deferred essentially all communication to Defendant Olerio, a convicted felon home builder who Defendant Pond unilaterally put ‘in charge’ of supposedly getting the restaurants open. Defendant Olerio immediately demonstrated that he was not fond of being questioned by investors.”
Olerio was sentenced to 24 months in federal prison in 2013 after pleading guilty in 2012 to conspiracy to commit money laundering, stemming from his role in a hydroponic marijuana growing operation. Other SMU fraternity brothers of Olerio’s were also sentenced in connection with that case.
The Lucky’s investors alleged in the lawsuit that by September of 2022, “no meaningful construction had been commenced on any of the locations.” In the meantime, Vandelay opened Brentwood, expanded Hudson House and D.L. Mack’s, and opened Slider and Blue’s and Anchor Sushi Bar. Vandelay also recently announced plans for Montecito’s and a new concept called Jack and Harry’s in Snider Plaza.
Lucky’s on Oak Lawn did open in 2023, and, the investors had alleged in the lawsuit, closed in four months.
“Plaintiffs learned of the closure by one of them driving by the restaurant,” the investors had alleged in court documents. “None of the other three locations were ever opened and Defendants abandoned the project never having accounted for the use of Plaintiffs’ money.”
The investors alleged in court documents that Pond emailed them in May 2023 to accept responsibility for the failure of the Lucky’s expansion and “cited a supposed hot chicken market downturn, inflation, underfunding, construction costs, and unforeseen delays in the permitting process as the precipitating factors for the failure.”
“Defendant Pond offered no documentary or any other documentation or data in support of these factors, much less an accounting of the use of the investment funds. At no time during the life of the investment did Defendants ever alert Plaintiffs to any problems or express a need for additional capital,” the investors had alleged in the lawsuit.
The East Dallas location on Gaston Avenue is the sole remaining Lucky’s Hot Chicken.
A trademark infringement lawsuit naming Vandelay filed in a California federal court after the recent opening of its Hudson House concept in the Los Angeles area near a pre-existing, unrelated restaurant with the same name is ongoing, court records show.
