Restaurant Owners Sue Landlord, Town Over Guilford Mooring Purchase

GUILFORD, CT — The purchase of The Guilford Mooring property appears to have hit a snag after the restaurant owners filed a lawsuit against their landlord and the town, claiming their actions prevented the restaurant from selling its business to a third-party and hurt its ability to continue operating.

Filed on June 16 in New Haven, the lawsuit lists landlord James Kohn and 505 Whitfield LLC as defendants, as well as the Town of Guilford.

The Guilford Mooring closed last November after 24 years in business at 505 Whitfield St.

In December, according to the lawsuit, the restaurant owners notified Kohn that they intended to seek a third party purchaser to acquire the restaurant and assume the lease.

A few months later in January, the Guilford Board of Selectmen voted to authorize Hoey to sign a letter of intent to purchase the waterfront property for $3 million.

Hoey said at the time that once it was known the property was for sale, the town reached out to the property owner through the Guilford Land Acquisition Commission and Guilford Economic Development Coordinator John Tarutis, in order to pursue a purchase.

After the selectmen voted to sign a letter of intent, Hoey called the potential purchase "a generational opportunity for us to preserve a feel and sense of community along the shoreline, and give folks an opportunity to be able to enjoy access to our coastal resources."

The lawsuit claims that at the end of January 2025 and continuing through May, the owners, Fran Pellegrino and Mike Romei, "received offers from potential third party purchasers of its restaurant business and assets, all of whom withdrew their offers based upon acquiring knowledge of the letter of intent and the deteriorated condition of the roof of the building on the property."

Kohn told CT Insider that the owners claimed several times they had a buyer, but never actually presented one. CT Insider said Kohn "would be happy" to lease the property to a buyer of the Mooring business and assets. Read more from CT Insider.

In February, the restaurant owners notified the town of an existing lease at the property and their interest "in maintaining its rights and interests under the lease with the intention of seeking a third purchaser to acquire said restaurant business and assets and who would assume the obligations of the tenant under the lease," the lawsuit stated.

The lease was extended through Oct. 31, 2026, with two additional three-year option terms thereafter, the lawsuit notes.

On Feb. 26, Guilford held a town meeting in which voters approved of the town's purchase of the property.

During that meeting, it was announced that the Department of Emergency Management and Homeland Security (DEMHS) confirmed the availability of FEMA grant opportunities for the property.

DEMHS provided guidance that the grant application could include not only funds for acquisition of the property and demolition of the building at the site, but also for post demolition improvements such as a pavilion, public restrooms and landscaping.

The lawsuit claims that in April, the town, through its counsel, notified the restaurant owners that it "intended to terminate the letter of intent... based upon the existence of the lease" and the owners' intent to sell the property to a third party.

Hoey told Patch this week that's not true.

"The town has never indicated that it would terminate its letter of intent to buy the property," Hoey said.

Additionally, the lawsuit claims that repeated requests for Kohn to fix the restaurant's leaky roof have been ignored.

In a news release that preceded the lawsuit filing, Romei and Pellegrino said the roof complicated any potential sale.

"As prospective buyers toured the property, concerns about the deteriorating condition made the sale increasingly difficult," the news release said in part.

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The lawsuit details six counts, including breach of contract; breach of covenant of good faith and fair dealing; tortious interference with contract; tortious interference with business expectancy; intentional misrepresentation; and violation of the Connecticut Unfair Trade Practices Act.

"I'm very surprised and disappointed that we are being dragged into a disagreement between the other two parties. The town has followed all of its statutory and charter required processes to investigate and pursue the purchase of this property," Hoey told Patch this week.

Hoey said the town is going to continue its "due diligence and discovery and all the processes related to a purchase and sales agreement."

"Obviously, this issue will have to get resolved at some point," Hoey said. "We're going to continue to secure this piece of property for the benefit of our community for generations to come."

In their news release, Pellegrino and Romei said the residents of Guilford are owed apologies for how the process has played out.

"The landlord owes an apology to the business owners, the town, and the community for mishandling the situation. The town must also acknowledge its responsibility for prematurely announcing the property purchase without proper authority," the news release said. "Their actions have obstructed the sale of the Guilford Mooring business, caused financial losses, and placed the business owners in an unfair and challenging position. Accountability must be taken, and justice must be served."