After more than a year of serving New Orleans-style cuisine in Pflugerville, Wild Magnolias restaurant closed its doors on Jan. 15 amid mounting financial troubles and a lawsuit.
Owner Darrell Owens opened the restaurant at 15424 FM 1825 in November 2018 with very little capital, which he said proved to be a recipe for disaster.
“I did everything out of pocket,” he said. “In the beginning, I felt like we could sustain business if we kept the doors open. When you don‘t have the capital and something breaks, you fall behind.”
Issues at the restaurant began over the summer when Owens said air conditioning at the building would frequently shut down. CSA Realty Group, a property management company, refused to fix due to what Owens called a loophole in the lease agreement.
In 2018, Owens said he was approached by Nancy Douglas and her business partner, Diane Ford, for assistance with contracting work to open a day care business next door to Wild Magnolias.
Owens said he initially asked Douglas to invest $10,000 in Wild Magnolias in exchange for the work, which he thought would eventually be paid off by the restaurant’s profits.
Owens said the renovations ― which involved combining three of the building’s units into one and rewiring electricity ― far exceeded what he expected to be the project’s scope.
But according to a document filed in Travis County District Court by Douglas in May 2019, she agreed to loan $30,000 to Owens in September 2018. Though they agreed to have Wilson pay back the loan with monthly $500 payments, Owens only paid the loan for the first two months, according to the document.
In October 2018, Douglas loaned an additional $10,000 to Owens, with an agreement for Owens to pay her back at a rate of $1,715 a month between December 2018 and May 2019, the document said.
Owens provided $500 for the September loan and $1,765 for the October loan, as well as $50 in late fees, the document said. But the document says Owens wrote a bounced check for $2,265 and failed to provide another payment.
Owens contended that Douglas and Ford demanded the money despite backing out of the renovation project.
“Nancy approached me to get the money back but we already started getting things done,” Owens said. “I had paid my contractors for a service that had already been started and almost finished. You can’t just change your mind after a service has been rendered.”
The day care never opened. In June, Douglas sued Owens in civil court, winning a default judgment of $56,544, which includes legal fees.
“He never showed up in court or anything,” Douglas said. “We wound up getting the judgment by default because he never responded to any of the questionnaires or anything from the judge.”
Owens said missing the court date was one of his biggest mistakes and is confident he would have won. He said he was busy with the daily demands of the restaurant, especially since he was the only chef.
“I couldn’t afford to miss a day, especially in its prime,“ Owens said. ”I was swamped. She (Douglas) had time, money and resources. I had none of that.“
So far, Douglas said Owens has paid about $1,000 of the judgment. “We made an agreement for him to make a monthly payment but he defaulted on that right away,” she said.
Owens said he plans to appeal the judgment in court. He said he only plans to pay $3,875 to cover the cost of some blueprints he lost during the renovations.
Douglas said receipts for permits would show payments she made going toward Owens’ restaurant, which Owens also denied.
“He kept saying it’s for you but everything had his restaurant name, so I’m like how do you deny it when it’s right there?” Douglas said. “He wouldn’t admit anything that he did.”
Douglas said she invested most of her late husband’s life insurance for the business venture.
“We thought everything was going to be OK,” Douglas said about her dealings with Owens. “He ruined our chance for a business.”
Owens said he faced other challenges at his restaurant. Poor management and mounting bills and taxes led to employees not being paid on time, he said.
He is also facing fallout from a former employee, Keyheira Keys, who has admonished him on social media.
Keys took over the restaurant’s Instagram profile, releasing text messages allegedly sent from Owens to employees as well as legal documents from Douglas’ judgment.
“I want to let the community know that if you work with this man, you are not going to get your money back,” Keys said.
Owens denied Keys’ claims that restaurant employees didn’t get paid, though he said some were occasionally paid late due to mismanagement.
He also denies claims of multiple restaurant investors who were scammed. A certificate of formation shows only Owens, Tomas Salinas and Quinton Walker as the owners.
“I didn‘t steal money,” Owens said. “We invested money knowing we may win or lose together.”
Owens said he’s in the process of suing Keys for defamation.
Owens will be working with owner Anthony Sheridan, who also owns Midtown Live Sports Cafe in Austin, in opening Smokey Creek Cajun Bar & Grill in Round Rock in March.
He said he will be learning from Sheridan on how to more efficiently run a restaurant.
“This was my first business venture,” Owens said. “I learned a lot of things and mismanaged a lot of things. Lesson learned.”
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