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Bitter battle continues over former Dolce Vita building

By Staff | May 4, 2011

While one island resident claims that his plans to open a new Italian restaurant are still on track for this fall, another is disputing exactly where it may be located.

A story which appeared in the April 28 issue of the Island Reporter, “Paganini overseeing new Periwinkle Way restaurant,” announced that celebrity chef Loretta Paganini was tabbed to assist Shoreline Finance in the opening of a new eatery to be called Il Cielo this October.

According to Paganini, who submitted a press release via e-mail and offered details about plans for the restaurant in a telephone interview, Il Cielo is to be located at 1244 Periwinkle Way, in the former Dolce Vita building.

However, on April 29, the Island Reporter was contacted by Jillian Algrin, co-owner and managing member of Ellington’s Restaurant Group, which operated their business at that location until earlier this year. She stated that the article was inaccurate.

“On April 12th, the judge overseeing the lawsuit between Shoreline Finance, LLC and Dolce Vita Restaurant Inc. ruled in favor of Ellington’s Restaurant Group, LLC. The judge overturned and vacated the foreclosure sale, sale and title of the property to Shoreline Finance, LLC,” Algrin wrote. “The property located at 1244 Periwinkle was most recently occupied by Ellington’s Jazz Club & Restaurant. The judge found that Ellington’s had significant interest in the property by way of a Purchase Agreement and considerable down payment made to Dolce Vita for the purchase of the property.”

In addition, Algrin provided copies of 20th Judicial Circuit Court judge Sherra Winesett’s order verifying the action.

“Shoreline, which is owned by attorney Charles P.T. Phoenix, foreclosed on Dolce Vita on August 13th, 2009, the very day that Ellington’s opened for business at the Periwinkle Way location,” she continued. “At the time, Ellington’s had a Purchase Agreement in place with Dolce Vita for the purchase of the property. When the foreclosure suit was brought against Dolce Vita, Shoreline claimed that Ellington’s was a non-party to the case and proceeded with the auction sale and purchase of the building. After reviewing the evidence in the case, the judge ruled that Ellington’s did have a distinct interest in the property and that the sale was invalid.”

“We are very happy for this ruling,” Algrin added. “It will give us an opportunity to level the playing field for the rightful purchase of the property.”

On Monday, Phoenix provided copies of several legal documents — including his Motion To Enforce Prior Order & To Show Cause For Contempt, filed in February — alleging that Ellington’s Restaurant Group, LLC had removed property from the rented real property, a violation of the court’s Distress Writ.

Phoenix called the April 12 action of Judge Winesett “a technicality” in the course of the ongoing legal battle between himself and Ellington’s representatives.

“The reality of the matter is whatever plan (Ellington’s) had didn’t work,” he said.

According to Phoenix, Shoreline purchased the mortgage to the Dolce Vita property from Busey Bank in August 2009, while that restaurant was already in the process of shutting down. When he filed suit to foreclose on the property, the owners of Dolce Vita filed for Chapter 11 bankruptcy.

“We had an agreement that as long as Dolce Vita paid their mortgage, and paid back some of their past debts, we would not foreclose on them,” said Phoenix, who also alleges that Ellington’s — who began renting the property from Dolce Vita — stopped making payments in May 2010.

In November, Phonenix stated that he filed suit for eviction. The day before the eviction was to take effect, he said that Ellington’s filed for bankruptcy.

Algrin said on Tuesday that Ellington’s made a down payment of more than $250,000 to Dolce Vita, which was supported in Judge Winesett’s ruling three weeks ago.

“(Phoenix’s) main focus is to go through the court process, concentrating on the lease agreement but completely ignoring the huge down payment we’ve already made,” said Algrin, who noted that the next hearing on the matter will take place in the 20th Judicial Circuit Court on Monday, May 9.

Should Judge Winesett rule in Ellington’s favor, as Algrin expects, the property will go through another bidding process. She and her fellow investors are anticipating a positive verdict and the opportunity to bid on — and ultimately acquire — the Dolce Vita building.

She also called the announcement of Il Cielo “premature, at best.”

Phoenix, however, is still moving forward with his plans to open the restaurant.

“We’ve got an incredible woman (Paganini) of very high stature, who is not only a great chef but a great friend of the islands,” he added. “Il Cielo is going to become Sanibel’s ‘go-to’ place for fine dining.”