Food Fight: Catering (Legally) to NYC Bars and Restaurants

Business Info

Helbraun, Levey, and O'Donoghue, LLC
110 William Street, Suite 1410
New York, NY 10038
(212) 219-1193

You see them all over the city. A, B, C, and the vaguely ominous "Grade Pending." They're health department letter grades, a relatively recent and moderately unwelcome tattoo of quality assurance (or not), unceremoniously stamped on New York restaurants like administrative alphabet soup. Believe it or not, these are only the latest additions to an American Gladiator-worthy obstacle course of administrative, financial, and legal snafus that every day confront New York City's restaurant and bar owners—defiant dreamers who, bless their hearts, choose to make it here instead of anywhere.

But that's what the city's built on: outsized ambition, even in the face of liquor license applications, construction permits, exorbitant rents, and the necessary blessing of your local Community Board. And that's why firms like Helbraun, Levey, and O'Donoghue came into being. Because yes, you can make it here, but not without a little help from the experts, especially the kind who eat paperwork for breakfast.

Service Industry Esquires

The Firm

"We're the only full-service bar/restaurant law firm in New York City that we're aware of," says Kevin O'Donoghue, the firm's most recent partner and in-house litigator. And that's a natural fit, given the partners' backgrounds. The one consistency in O'Donoghue's "unusual mixed background" (he was a journalism major and an English professor) was the hospitality industry: "In between jobs I was always working in the service industry—bartending, waiting tables. I even managed bars in law school." David Helbraun, the firm's founder, ran a string of coffee bars in New York and worked off and on as a bartender.

What drove them from service to advocacy? Experience. "[David] was unhappy working with the NYC agencies," says O'Donoghue. So—outsize ambition and all—Helbraun started his firm to support people in his position. "A few years later, he hired Joseph Levey. One of the main things Joseph did was work on finding bars and restaurants that needed permits," says O'Donoghue. "They began working on a practice area that helped bars and restaurants get off the ground: leasings, deals, closings, getting necessary permits, licensing, etc. They get people in business, and I try to keep them in business." The firm maintains strong sympathy with entrepreneurs of all stripes, but especially since O'Donoghue became partner in 2011. "We made a decision that we should shift our focus to being a boutique bar and restaurant law firm. I believe 90 percent of our clients are bars and restaurants."

The Troubles They've Seen

O'Donoghue, inked like a chef

So what exactly does a firm like Helbraun, Levey, and O'Donoghue provide to clients like Fedora, Dovetail, Vinegar Hill House, Mehtaphor, Goat Town, and Public? Basically anything administrative that butts its head in between a chef/bartender/owner and the execution of basic services. Based on client feedback, they seem to be doing a good job. "It really is customized legal services for each client," says O'Donoghue. "Even though there's a consistency of types of problems that arise and solutions in place, the defense process for each client is different. You might have two restaurants on Broadway across the street from each other. One is a sole proprietor; one is backed by 25 partners. It's a very different process for each."

It's not just the size or legal infrastructure of a bar or restaurant that matters. The cooking matters, too—especially with regular visits from the New York City Department of Health and their (idiosyncratic?) grading styles. "The Health Department sees the same violations over and over again," says O'Donoghue. "But the way restaurant A makes its chicken can be totally different from restaurant B; the way hollandaise is made, or sous vide is used"—i.e., with legal permission or not—"really can change the outcome." Depending on the score (anything 28 or more is a fail) the law firm will step in to appeal. "I've had Cs go to As, Bs go to As," says O'Donoghue. "It really depends on the facts, the way the inspector charges the violations, and which judge decides the case."

Variety Is the Spice of Law

Letter grades might be the most prominent issues—and certainly one of the more touchy subjects—of restaurant/bar ownership. But as anyone with a lease, some start up capital, and a dream knows, many more issues can arise. Fortunately firms like this one know how to prioritize them. "Your landlord is the most important business relationship you have," says O'Donoghue. "You have to be careful to ensure the way the lease is done, that the deal is structured to work for the individual client."

But don't celebrate yet (ever). After signing a lease, every contract, ordinance, and relationship along the way matters. "I think people tend to forget that the restaurant industry, like any other, has its own business problems." For instance, consider a chef hired to develop a menu concept, without a clear exit in their contract. "You believe you're going in to create a menu for four weeks, they believe you're going to be there every day for six months," says O'Donoghue. "They want you to put your name on it, and you don't want your name on it. They want chef in the kitchen, and he has his own places to be at every night. I can think of a number of examples of that."

And then there are the numerous tickets and violations from city agencies like the police, fire department, buildings department, and state liquor authority. Even the liquor license process requires customization. "It's definitely not one-size-fits-all. Every liquor license requires the same amount of paperwork, but the community board is always different, who your operator is is different," says O'Donoghue. And then there are the "random ticket" monsters that sometime rear their ugly heads. "The police on the Lower East Side love to walk down a street like Rivington and write every bar a ticket for excessive noise," says O'Donoghue. "The tickets rarely stick, because they don't write them correctly—they use the wrong law, don't measure the noise—but then the State Liquor Authority can bring its own case against the licensee for violations that were already dismissed. It feels like unendurable harassment to many operators."

The moral of the story: "A lot of weird things happen in the New York restaurant world," says O'Donoghue. "You have to deal with landlords, business divorces, partnership disputes, that kind of thing." Let's not forget managing margins, maintaining a healthy public image, oh, and developing a menu that'll work for your public and drive profits. Want to do all of that without sacrificing your personal integrity and/or sanity? Leave as much as possible to guys like these. "We'd rather have people be happy than make money off them," says O'Donoghue. You have it in writing, folks, from the mouth of a New York City lawyer.