In early July, the last few restaurants in what was once pitched as a $30 million restaurant company with a 24-year history in Southern California were shuttered for good.
The closures were the result of a personal bankruptcy filed in Arizona by the founder, Joe Manzella, who had launched the small empire in 1999 with the debut of Taps Fish House & Brewery in Brea, Calif., a lively 14,000-square-foot, high-volume concept that was known for fresh seafood classics and steaks, as well as a Las Vegas-style Sunday Brunch.
It closed its doors for good on July 7, as did a Taps location in nearby Corona, Calif., and a smaller Taps Brewery + Kitchen variation in Yorba Linda that was part of a new venture designed to expand on the brand. A few days earlier, a sprawling brewery and tasting room in Tustin, had also closed permanently.
Joe Manzella. | Photo courtesy of Manzella Restaurant Group.
Manzella had started the business with his late father and sister. Over the years, the Taps brand family had grown at one point to five locations under Manzella Restaurant Group, including a popular restaurant called The Catch, near Angel Stadium, where players would sometimes gather after games.
In 2019, a new partner entered the picture. At the time, Joe Manzella wanted to expand and he brought in a consultant, Randy Teffeteller with West Coast Ventures and Resources (WCVR), to help with an acquisition. That relationship grew into a partnership and soon Teffeteller was managing the legacy Taps brands. The two also launched a new venture called Tableside Partners, designed to expand the portfolio.
But that relationship came to an end in 2022, the year Joe Manzella filed bankruptcy and Teffeteller was terminated.
The businesses that once had showed promise have devolved into a tangled mess of bankruptcies, lawsuits and finger pointing that trustees in two active bankruptcy cases are sorting through to repay creditors. Tableside Partners is being dismantled, and the restaurants planned under that arm have been sold, rebranded or closed—though Teffeteller with other investors has picked up some of the pieces.
One of the bankruptcy cases began as a reorganization but has been reverted to a Chapter 7 liquidation. As a result, the corner lot where the original Taps Fish House sits has been listed for sale, asking $7.5 million.
And Teffeteller may put in a bid for it.
A view of a store front sign for the seafood restaurant chain known as Taps Fish House and Brewery. | Shutterstock
A tangled web
The story of what happened to Taps Fish House and related brands is complicated and it’s far from over.
Joe Manzella—in interviews and in court documents—places the blame squarely on Teffeteller. In media accounts and social media posts, he raised allegations of fraud and stolen Covid relief funding, saying there were three criminal investigations ongoing.
“He conned all of us, our partners, vendors, lenders, landlords and banks,” wrote Joe Manzella in an email. “Then he conned the BK trustees. Two of them. And now it’s time to con the media. Simply unbelievable and spectacular.”
However, Teffeteller in interviews and court filings tells a very different story.
With similarly dramatic language, describing Manzella as a “bad actor” allowed to “run amok,” who stole money from his own sister and tried to hide millions from creditors and the bankruptcy court.
“It is reminiscent of a child claiming innocence while pointing fingers at everyone else,” wrote Teffeteller in an email. “Mr. Manzella is not the victim but rather the protagonist of this story.”
Both Joe Manzella and Teffeteller have raised allegations that Covid relief funds have been misappropriated, that Michele Manzella was taken advantage of, and that corporate money was looted—with each accusing the other.
Joe’s sister Michele Manzella, despite being a key player in this drama, declined to comment. After an initial interview, Joe Manzella also declined to respond to questions about allegations raised in court filings.
A trustee takes over
Much of the very convoluted Taps story unfolds in the personal bankruptcy of Joe Manzella and in a settlement agreement signed by all parties, which never took effect.
Joe Manzella's bankruptcy began as a subchapter V, one in which the debtor is given more control over the plan and has fewer disclosure requirements. But that didn't last.
Teffeteller’s attorneys offered evidence that Manzella repeatedly attempted to transfer cash and other assets to avoid garnishments and levies, without disclosure, and that he misled the court about both assets and liabilities as part of a “pattern of deception.”
In December 2022, for example, Michele Manzella created a new company called Manzella Holdings LLC, about nine months after Joe Manzella had filed personal bankruptcy and about two months after he had been removed as a debtor-in-possession.
Over the next four months or so, Joe Manzella moved an estimated $3.5 million from the various businesses to Manzella Holdings, without disclosing it to the trustees, according to court documents.
“It appears the money was largely used for permissible business operations,” Trustee Lynton Kotzin wrote in court filings later, when the account was later revealed, but it was still a no-no.
Kotzin added that Joe Manzella had been “less than candid” with the court and that he failed to meet bankruptcy disclosure requirements.
Some of the money was said to be for repayment of loans—loans that were also not disclosed to the trustee. Another $10,000 was for legal fees the trustee, again, did not authorize. And there were other details revealed, like $5,000 used to pay for food at Michele’s wedding, for example.
Trustee James Cross took control of finances in May 2023. One of his first moves was to close the restaurants. They weren’t making enough profit to pay employees and keep the businesses open, according to court documents.
Earlier this month, Cross sued Manzella’s in-laws to recover nearly $750,000 that Manzella had transferred to his wife’s parents in an attempt to “hinder, delay or defraud creditors.”
Cross also hired a specialist to determine the value to the estate of existing liquor licenses.
A partnership soured
Manzella and Teffeteller met through a mutual acquaintance in 2019.
At the time, Manzella was hoping to acquire a restaurant called Pacific Fish Grill and expand the Taps empire. The company had just invested in building the $3.3 million brewery production and tasting facility for the brand’s award-winning beer. In 2018, the original Taps Fish House had undergone a $1.5 million remodel.
Teffeteller’s company, WCVR, offered its services to help with the acquisition.
The relationship grew and WCVR was hired to manage Manzella’s legacy entities as CEO. In addition, Teffeteller and Manzella launched a new company called Tableside Partners, a 50/50 venture designed to build and operate more streamlined variations of the Taps Fish House and brewery brands, as well as expanding with other concepts.
Previously, Teffeteller had been involved with restaurants as managing partner of two other consulting groups: American Brand Equity Partners, which he led from 2004 to 2010 and was involved with brands like Juice Stop; and from 1999 to 2006, he led Hospitality Management Group Inc., which on his LinkedIn profile implies worked with a number of brands, including Chico’s Tacos, Pasta Bravo and the B.B. King’s clubs in Memphis and Los Angeles.
In 2007, Teffeteller was ordered to stop selling Juice Stop franchises in California because the brand had not been registered for franchising in the state. Some of those brands, like Juice Stop and Chico’s Tacos, for example, ended up in bankruptcy.
But Teffeteller explains that’s part of his job.
“We do workouts. We do brand building, but primarily workouts. We work with banks on troubled assets and we turn them around,” he said of WCVR. “We either M&A, or we sell, or we liquidate, but we do workouts.”
When he was hired by Manzella in 2019, Teffeteller described the Taps restaurants as already in a dire situation, one that the pandemic shutdown later made much worse.
In the consulting agreement that was signed by both Joe Manzella and sister Michele Manzella, Teffeteller laid it all out, saying he was being brutally honest at the time.
He described the restaurants as suffering a three-year decline in sales, with debt service exceeding cash flow and no plans to resolve the situation. Prime costs had exceeded 60% often, he said. The brewery in Tustin had not been adequately vetted and was hemorrhaging money, causing catastrophic cash flow problems. The management team was “a good old boy network” of older white males who lacked the needed expertise.
The company had “lost the family restaurant vibe,” the consulting agreement added.
In addition to the business challenges, the Manzella family, including other siblings, was embroiled in lawsuits that went back as far as 2014, mostly involving money and loans for the businesses.
Still, Teffeteller saw opportunities. The brewery produced award-winning beer, and Taps was an iconic brand with a strong reputation in the region.
Photo courtesy of Manzella Restaurant Group.
Enter the pandemic
All restaurants took a hit during the pandemic, and the Taps brands were no exception.
Many restaurants turned to takeout to survive, but that was tough for Taps' seafood-heavy concepts, Teffeteller said. “It didn’t make sense to do lobster and sea bass for takeout.”
Despite efforts to renegotiate with landlords, there were casualties.
The Catch never reopened after the Covid shutdown, for example, after filing Chapter 7. A Taps Fish House location in Irvine, Calif., also never reopened after the second Omicron-related wave.
But Teffeteller described the original Brea location as a “golden goose” that helped keep the rest of the businesses afloat. “Everything was sucking off of Brea,” he said.
After the pandemic, however, Teffeteller said the situation began to improve.
Tableside planned new growth, with smaller-version Taps locations opening in Arizona, and scheduled for Nebraska and Indiana, with leases guaranteed by South Coast Concepts, the company operating the original Taps Fish House in Brea. Teffeteller also brought in new clients and brands to the portfolio through joint ventures, such as Alondra’s Hot Wings.
But the situation was far from rosy.
Teffeteller wrote in court filings that during the course of WCVR’s consulting assignment, “it became clear to me that Manzella was an ineffective and often incompetent manager.”
Vendors were not being paid. Taxes were not being paid. Joe Manzella said this was Teffeteller’s responsibility as CEO. The Taps/Brea location alone had brought in $4.3 million in Covid relief money, he said. "How is it closed? How?"
Teffeteller said Joe Manzella was the one who applied for that Covid relief. He said his former partner refused to comply with basic accounting controls and was “co-mingling” and “looting” corporate cash, while knowingly operating on the brink of insolvency.
Things really started to fall apart after Joe Manzella filed bankruptcy in March 2022.
Teffeteller said Joe Manzella needed money—more than Teffeteller was willing to give, though WCVR had offered cash infusions in the past, secured by the Brea real estate.
Later that year, Joe Manzella fired Teffeteller.
The termination letter, which was included in court documents, cited 30 issues, ranging from failure to pay taxes and rent, to misappropriation of an estimated $16 million in company assets; as well as “misapplication” of about $3.2 million in Restaurant Revitalization Fund (or RRF) grant money and unspecified amounts of Paycheck Protection Program and Economic Injury Disaster Loan (EIDL) funds.
The termination letter also cited fraud related to various loans and, fundamentally, that WCVR failed to help the company turn a profit in any six-month period year-over-year.
A settlement unsettled
Teffeteller contends in court that the termination was unlawful.
But in court documents, one trustee does raise concerns about Teffeteller’s actions at times.
At one point, a settlement was proposed in which Teffeteller and Joe Manzella planned to give Michele Manzella a 30% stake in Tableside Partners for a $1.5 million investment.
Teffeteller, however, instructed Michele to transfer $400,000 toward that investment directly to WCVR. In court filings, the trustee noted it was at least the second time Teffeteller had required funds for the legacy restaurants or Tableside be directed to him/WCVR directly, rather than an appropriate entity.
“The Trustee has serious concerns about these transfers which may give rise to substantial claims against Mr. Teffeteller,” the trustee wrote in a footnote, saying the whereabouts of the remaining $1.1 million was being determined.
Teffeteller in an interview said Michele had asked him to route that money to the business, and the paper trail has been sent to the court.
The deal to give Michele a stake in that business, however, and the proposed settlement was voided because it was signed after the bankruptcy and without court approval.
The aftermath
Joe Manzella has lost two properties, a boat and his businesses, though he continues to express hope that the Taps brand could someday be revived.
Both Teffeteller and Joe Manzella said they feel for the 100-some workers that lost their jobs as a result of the closures this month, many of whom were not immediately paid because of the bankruptcy.
And then, of course there are guests with gift cards or event bookings.
Mark Fujii, for example, said he fears he lost a $500 deposit for his wedding, which was scheduled in November at the Tustin brewery.
“It was a big chunk of our (admittedly) pretty limited budget,” he wrote in an email. “We don’t have the money for an extravagant wedding, so this really hurts.”
Teffeteller says he has a secured debt against Manzella Properties for $1.8 million, plus interest, and an unsecured claim for $2.2 million for accrued consulting fees he says he didn’t take while the restaurants were struggling through Covid.
But he has not been left empty handed.
Teffeteller, with other investors, has picked up several Taps locations and rebranded or have plans to rebrand. The former Taphouse Kitchen in Scottsdale, Ariz., for example, was sold in bankruptcy to Teffeteller and other investors. It has reopened as Urge Taphouse Kitchen. Another planned Taps site in San Diego has opened as Urge Gastro Pub.
There’s also the Taps Brewery + Kitchen unit in Yorba Linda, Calif., which will be rebranded, possibly as an Urge, Teffeteller said.
In one proposed settlement, a $100,000 Magic Deck power boat that belonged to Joe Manzella, but was used as collateral for a loan, will go to Teffeteller for $25,000.
And then there’s still that “golden goose.”
Teffeteller said he is now working with a potential bidder on the Brea property—investors tied to a restaurant chain he declined to name—that “really want that corner.”
Teffeteller said he might join in that bid as an investor, though he hadn’t yet decided whether he would.
“My interest is to get away from this whole entire thing,” he said.
Joe Manzella, meanwhile, said in an email that he’d also gotten wind that Teffeteller was among potential buyers for the Brea site, “the land and building he intentionally made insolvent, forced into BK, and now wants to own."
Teffeteller is also 50% owner in a licensed Taps location long planned for Orange County's John Wayne Airport. He has put in a request to acquire that contract.
“This crap belongs on television,” Joe Manzella added. “It really does.”