Restaurateur Peter X. Kelly has petitioned for bankruptcy protection for the second time in less than four years to reorganize two restaurants that owe millions of dollars in state and federal taxes.
HCC Caterers Inc., the owner of X20 Xaviars on the Hudson in downtown Yonkers, and Ripe Inc., owner of Restaurant X & Bully Boy Bar in Congers, Rockland County, filed Chapter 11 reorganization petitions May 5 in U.S. Bankruptcy Court, White Plains.
The bankruptcies mirror similar circumstances in 2019 when HCC and Ripe sought bankruptcy protection.
The new petitions were reportedly filed after the state Department of Taxation and Finance temporarily seized X20 to enforce tax debts, but both restaurants appear to be open for business now.
Kelly, a Yonkers native who describes himself as a self-taught chef, has won acclaim for menus that incorporate classic French techniques, Italian and Spanish influences and Asian embellishments.
His restaurants owe more than $3.5 million, according to their schedules of unsecured claims, to the IRS, the U.S. Department of Labor Wage and Hour Division, and New York State.
HCC, for instance, shows $1,038,886 owed to the IRS, $960,716 to the state, and $263,077 to the Department of Labor.
Ripe shows $633,200 owed to the state, $433,780 to the IRS, and $241,618 to the Department of Labor.
The state has submitted formal claims that put the debts for both businesses at more than $3 million, or nearly double the $1.6 million that the petitions list.
The state’s claims include both secured and unsecured debts, whereas Kelly has not yet disclosed his secured debts.
Both businesses estimated assets of  less than $50,000 and liabilities of $1 million to $10 million.
HCC, Ripe, and Kelly personally filed for Chapter 11 protection in 2019. Combined, they declared $1.3 million in assets and $6.7 million in liabilities.
Two years ago, bankruptcy court dismissed all three cases at the request of U.S. William K. Harrington.
The restaurants had struggled to reorganize during the Covid-19 pandemic, according to the trustee’s trial attorney, Greg M. Zipes. They had been losing money every month, assets were declining steadily and their cash reserves were decreasing.
By February 2021, two out of every five employees were no longer working for the restaurants, according to their monthly operating reports, leaving 37 at XO and 21 at Restaurant X and Bully Boy Bar.
“It is unlikely,” Zipes told the court a year after the restaurants declared bankruptcy, “that the debtors have the ability to rehabilitate themselves if economic conditions do not change.”
In the new cases, the restaurants must file more detailed financial information later this month and submit reorganization plans in September.
HCC and Ripe are represented by New City attorney Scott B. Ugell.
