Owner of Port Orange's Fysh restaurant files Chapter 11 bankruptcy. Here's what it means.

PORT ORANGE ― One week after being sued by his landlord for owing more than $229,000 in back rent, the owner of Volusia County's largest restaurant on Tuesday filed for Chapter 11 bankruptcy protection.

The legal maneuver allows Sidarth "Sid" Sethi, 29, to continue operating the 18,000-square-foot Fysh Bar & Grill restaurant in Port Orange while receiving a temporary reprieve from having to pay creditors.

That includes his landlord, Josif Atanasoski, who in his March 12 lawsuit against Sethi accused the young restaurateur of owing $229,737.73 in unpaid rent.

It is not known at this time who the other creditors are.

The U.S. Bankruptcy Court for the Middle District of Florida immediately granted the temporary relief, according to the notification sent to Atanasoski.

Sethi on Wednesday morning did not respond to a request for comment about his Chapter 11 filing.

What's at stake?

Atanasoski, doing business as Halifax River Partners LLC, is seeking court approval to take possession of the property. His lawsuit also requested that Sethi cover all attorneys' fees as well as any other related costs.

Atanasoski in his lawsuit accused Sethi of only making partial payments on his monthly rent and in making those payments late. The last of those payments was received on Dec. 26, 2023.

Atanasoski in his lawsuit stated that he considered Sethi's 15-year lease on the property null and void because of his failure to keep up with his rent payments.

Sethi told The Daytona Beach News-Journal on Saturday that a company that owns several national restaurant chains recently approached him to express interest in buying him out and negotiating a new long-term lease with Atanasoski.

Neither Sethi or Atanasoski, who confirmed the interest from the third party, would identify the mystery company's name nor the names of the chains it operates.

Sethi said he intends to continue to work on turning things around for Fysh.

Sethi, doing business as Sideats Inc., opened his restaurant in October 2022. Fysh, at 3633 S. Ridgewood Ave., next to Riverwalk Park, employs between 75 and 100 employees.

Sethi pleaded for more time

Sethi told The Daytona Beach News-Journal on Saturday that his monthly rent for Fysh was approximately $40,000. He said he recently offered to make a rent payment only to be sued by his landlord the next day.

Sethi said he also pleaded for more time to come up with the money to make things right with Atanasoski.

"My plan to pay this deficiency is by bringing in an equity partner and send you the owed balance payment upfront," Sethi wrote in an email that he said he sent to Atanasoski.

The copy of the email provided to The News-Journal did not include the date it was sent to the landlord.

"With my recent success and numbers to show so far, I am confident I can bring someone in to give me a boost," Sethi's email stated. "Please allow me some time while I weigh my options and find a good fit for a partnership. In the meantime, I am starting back on rent payments so you can stop the bleeding. ... I am working with SBA and other creditors to begin smaller payments start April so they can get off our backs."

Sethi said he was also reaching out to a family member for financial assistance.

Sethi: Landlord ignored request for more time

Sethi said he received no response from Atanasoski to his request for more time, and was hit with the lawsuit the next day.

Sethi also told The News-Journal that if he was unable to persuade Atanasoski to give him time to bring on the additional partner or partners, that he would have no choice but to file for Chapter 11 bankruptcy protection.

He said when he got sued by Atanasoski, he had no choice but to use the rent payment money to hire an attorney.

The Chapter 11 filing was made on Sethi's behalf by attorney Bryan K. Mickler of the Law Offices of Mickler & Mickler LLP in Jacksonville.

The News-Journal was not able to immediately reach Mickler for comment.

Landlord's response

When told how Sethi characterized the situation over the weekend, Atanasoski in a text message to The News-Journal on Monday wrote, "Unfortunately Sid did not tell the truth."

Atanasoski did not elaborate.

Sethi tells his side on social media

Sethi on Tuesday posted a lengthy statement about the situation regarding Fysh on multiple Facebook group chat pages, explaining his desire to "clear the air and provide some context for our local supporters."

The following are excerpts from his statement:

"We knew the challenge we were facing upon taking on millions of dollars in debt to open a restaurant this size here in Port Orange, but we took it head on and ended up facing some road bumps, just like any new startup business.

"Although guests flooded within our restaurant upon the first 8 months of launching, we quickly began recognizing issues and challenges at hand. In our specific case, the majority of our issues stemmed from poor management, lackluster service, and a constant disarray of food coming out at different times. ... It became a snowball effect and financial issues began to occur. ...

"An eviction notice sucks, no denying it. But operations will still continue and there are always ways to cure or respond to such notices, legally."

Sethi added, "Over the past two months, we made some major and necessary changes to our entire front of the house and kitchen management. We put together a brand new team which consists of professionals who are passionate about customer service, food quality, and team work. ... I can not promise what our future holds at this exact moment, but I CAN promise that I will stand behind our team and community to give everything we have towards prioritizing our guests and improving our restaurant experience in every aspect, regardless of our outcome."

This article originally appeared on The Daytona Beach News-Journal: Port Orange's Fysh restaurant files Chapter 11 bankruptcy