Boston says it won’t block Barbara Lynch from selling off restaurants during tax fight

In the ongoing legal fight between acclaimed chef Barbara Lynch and the city of Boston, the two sides filed a proposal in court that will allow her to sell her last two restaurants as long as she puts the profits aside for Boston to collect any unpaid taxes.

The city filed suit against Lynch and her seven Boston restaurants last month claiming they owe $1.7 million in unpaid taxes that stretch back more than a decade. Lynch is fighting the lawsuit.

Initially, the city had also sought a preliminary injunction to block Lynch from selling restaurants. Monday's proposed order — which still needs a judge's approval — would let the proposed restaurant sales continue as long as proceeds are put into an escrow account.

In Massachusetts, businesses must pay municipalities personal property taxes annually on tangible items that can be moved, like business equipment or furniture. The city sent final notice letters to the restaurants demanding payment in January, several days after Lynch announced she was closing and selling five of her Boston restaurants.

The tax lawsuit is the latest setback for Lynch, a James Beard Award-winning chef and restaurateur. She was accused by former staff of abusive behavior and fostering toxic work environments in a pair of stories published last April by the Boston Globe and New York Times. Lynch has vehemently denied the allegations.

Several former staffers also sued her for allegedly withholding tips for two months during the pandemic. That lawsuit is ongoing and Lynch has denied the allegations. A pair of specialty vendors sued Lynch over unpaid bills in small claims court in Boston. Both cases were settled.

Lynch hasn't commented on the tax lawsuit and didn't immediately return a request for comment. (An earlier court hearing suggested that Lynch may be removed personally from the lawsuit, but that change hasn't appeared in the filings.)

Lorraine Tomlinson-Hall, chief operating officer for the Barbara Lynch Collective, told WBUR earlier this month that a group of investors who had planned to buy Lynch’s two remaining restaurants – No. 9 Park and B&G Oysters – could have pulled out of the deal if the lawsuit paused the process.

“There are 62 jobs at risk,” Tomlinson-Hall said. “It's very scary and worrying.”

Tomlinson-Hall said the restaurant group was “blindsided” by the lawsuit and had sought – unsuccessfully – to communicate with Boston’s tax office when she received the final notice letters in January.

At the Dec. 4 court hearing at Suffolk County Superior court, Lynch’s lawyer, Randy Hitchcock, told the judge the city never responded to Tomlinson-Hall: “There was no return call … just crickets.”

The city has repeatedly declined to comment on the Lynch case but a spokesperson told WBUR in a statement that its tax office “takes every step to notify taxpayers of outstanding personal property taxes."

Andrea Martin, an attorney representing the city, argued in court that Lynch’s restaurants ignored tax invoices “year after year.” She said the city was left with no choice but to pursue legal action over the unpaid tax bill when Lynch announced she was selling her restaurants. Otherwise, Martin told the judge, the city “could be left with nothing.”

Robert Kiley, CEO of the Massachusetts-based Restaurant Accounting Services, said while it’s not unusual for restaurants to fall behind on their taxes, they’re usually able to work out payment agreements with local governments.

“The more you kick the can down the road,” Kiley said, "the more screwed you are when it's time to pay the piper.”