Report: Restaurant.com lawsuit accuses CEO of bringing company to 'brink of bankruptcy'

Two shareholders of Restaurant.com say their CEO has left the Arlington Heights-based company on the brink of bankruptcy, and they are asking a Cook County circuit court judge to fire the CEO and require him to pay millions of dollars.

Adnan Adamji of Illinois and Steven Schnall of New York are suing Kenneth Chessick, a lawyer and Chicago resident who became CEO of Restaurant.com in 2012. The lawsuit, filed in October, claims the company was profitable until Chessick took over, as reported in a Loop North News story.

Revenue dropped from $63 million to $45 million during his first year and has declined every year since, say Adamji and Schnall, claiming it stemmed from bad business decisions. Adamji was the company's chief information officer, overseeing a revamping of the Restaurant.com website that sells gift certificates for restaurants nationwide. He says the company took in $7 million in 2006, $23 million in 2008, $53 million in 2010 and $63 million in 2011.

A court hearing is scheduled for March 2.

The suit accuses Chessick of using company money to pay for first-class travel, donations and other purchases and of intentionally mismanaging the company in a scheme to drive down its value, push out other shareholders, sell the company and make millions for himself.

Restaurant.com is, they say, "in poor financial health at present and may be on the brink of bankruptcy."

Adamji and Schnall are calling it breach of fiduciary duty, failure to maximize shareholder potential, and unjust enrichment. They are asking for monetary damages plus punitive damages. They want Chessick stripped of titles and control of the company and a receiver appointed by the court to run the company.

And they want Chessick to be forced to give back all his compensation and expense reimbursement.