The once-high-flying restaurant group Glu Hospitality has shut down amid wage-theft allegations and lawsuits

Glu Hospitality, a fast-rising collection of vibe dining restaurants facing lawsuits and wage-theft accusations, has shut down, effective immediately, said Derek Gibbons, the group’s chief operating officer.

Gibbons said Glu, which he founded in 2019 with business partner Tim Lu, had grown too aggressively.

Glu — whose name is a portmanteau of Gibbons and Lu — scaled rapidly during the pandemic, eventually operating seven made-for-Instagram restaurants in Philadelphia during the group’s peak in 2023 and 2024, including the Blade Runner-themed ramen bar Chika, the short-lived Brewerytown Food Hall, and Figo, a massive indoor-outdoor Italian restaurant known for its bottomless espresso martini towers. It also launched the Bagels & Co. chain in Pennsylvania and Florida; Gibbons said it was unaffected by Glu’s shutdown, as it has other investors.

The shutdown has closed Figo, whose name was scraped off its windows in the Piazza in Northern Liberties on Tuesday. Gibbons said a new company would take over the space. The Peabody, a sports bar that Glu opened two weeks ago on Cecil B. Moore Avenue on the Temple University campus in North Philadelphia, is still open but under new operators from New York, he said.

A third restaurant, Izakaya Fishtown, will remain open as new owners take over, Gibbons said. A Japanese restaurant on Frankford Avenue near Berks Street, Izakaya is affiliated with a New York group whose ’90s hip-hop-themed sushi bar, branded as Sushi by Bou, is in the rear. Glu’s management agreement with the Old City location of New Jersey coffee chain Almost Home General has ended, and that location, at Second and Race Streets, is still operating.

» READ MORE: From December 2022: Glu can't stop opening restaurants

The decision to cease operations comes about a month after The Inquirer disclosed that four of Glu’s restaurants were selling alcohol using catering permits or expired liquor licenses. Glu also faced extensive accusations of wage theft from employees, as well as lawsuits alleging that the company defaulted on leases for a prospective restaurant in Center City and a never-opened Bagels & Co. location in South Philadelphia.

“During COVID, we felt like the only way we would be secure as individuals or be secure for our families was to get to a scale of a large number” of restaurants, Lu said Wednesday. “We wanted to get to that security.”

At the outset of the pandemic, Glu also operated Leda & the Swan, a cocktail lounge at 1224 Chestnut St. attached to 1225 Raw. Last September, the Leda space was converted into a Sushi by Bou location, but it closed less than three months later.

Gibbons and Lu suggested in separate interviews that their partnership was over. Lu said he had stepped down as chief executive officer in early 2024 to become an adviser and a member of the company board. Lu said the company had six minority investors he declined to identify.

Glu had “a couple of hundred” employees at its peak in 2023, said Gibbons. On Wednesday, he estimated that Izakaya and The Peabody had 15 workers and that Figo had 20 to 25 remaining. Employees at each would be given the opportunity to stay on under new ownership, Gibbons said.

Gibbons said that Glu had reached the decision to shut down in early March, though OpenTable reservations are still available at an assortment of its restaurants, including Brewerytown Food Hall, which closed last year. As of Wednesday afternoon, Instagram posts from Figo were still advertising the ability to buy “girl dinner,” a.k.a. a Caesar salad and fries. The Glu Hospitality website has expired.

A potential customer named Katie, who is turning 30 on Saturday, said she found out that Figo was closed for good at about noon Tuesday, just four days before she was set to host 32 people for her birthday at the Italian restaurant. She had been texting Figo’s event planner about the cake the day prior.

“I just feel like the rug got pulled out from under me,” said Katie, who has family traveling from Florida and upstate New York to celebrate. She declined to give her last name over privacy concerns.

Glu was “not in a great financial place,” Gibbons said in an interview, which impacted the restaurant group’s ability to pay workers consistently and keep liquor licenses in good standing.

At least six former Glu employees have filed claims with the Pennsylvania Department of Labor over back wages, according to a lawyer with Community Legal Services who helped some of the individuals prepare their claims. The Pennsylvania Department of Labor declined to comment when asked if an investigation had begun, citing confidentiality. The department has not issued violations or entered into a signed settlement agreement with Glu Hospitality at this time, a spokesperson for the agency said.

A petition signed by “the workers of Glu Hospitality” was published online in October by Nia Byrd, a former bartender and server who worked at different Glu establishments until March. Signed by more than 3,000 people, the petition asks Glu to “immediately pay all back wages owed to workers” and “address frequent occurrences of bounced checks,” among other allegations of financial mismanagement.

Gibbons confirmed that a state Department of Labor Investigation has been underway since November and that employee checks bounced regularly. Both he and Lu had discussed staffing reductions to cut costs, they each said, but those never came to fruition.

Gibbons said the inability to pay staff consistently was part of the reason why they decided to shutter Glu.

» READ MORE: Glu is operating bars with improper licensing

“It was obviously terrible while it was happening,” said Gibbons, who stated that workers have since been made whole. “There was never any mal-intent toward our staff or vendors or anyone. I don’t think anyone gets into hospitality with some secret motive.”

Alyssa Biggs — who worked as front-of-house staff at Izakaya Fishtown and the Glu-managed Center City sushi restaurant 1225 Raw until August 2024 — filed a claim with the state’s Department of Labor that same month over a trio of paychecks from July 2024 that bounced consecutively. Two of those have since been addressed, Biggs told The Inquirer, but one is still outstanding.

“I could tell they had bigger money issues than just little old me,” said Biggs, 24, who described working for Glu as akin to “failing a level of one of those restaurant video games.”

Glu’s financial predicament became public when most of the restaurant group’s establishments stopped serving alcohol — a key part of their business.

The City of Philadelphia ordered the shutdown of 1225 Raw, at 1225 Sansom St., in January over unpaid taxes. Its liquor license was listed under the name of Tony Rim, the sushi restaurant’s previous operator. Earlier in March, Glu decided to shutter Chika after The Inquirer disclosed in February that the ramen bar at 1526 Sansom St. had been serving alcohol illegally since its liquor license expired on Oct. 31. In its final days, Chika operated as a BYOB.

» READ MORE: Chika ramen bar, operating as a BYOB, has closed

Bars and restaurants are required to have liquor licenses issued by the Pennsylvania Liquor Control Board to purchase and sell wine, beer, and spirits. The documents must be renewed annually and can be denied if an establishment’s state taxes are not paid. Those suspected of disregarding liquor laws can be investigated by the state police’s Bureau of Liquor Enforcement, which can result in shutdown orders, fines in excess of $1,000 per violation, and citations for managers.

On Jan. 30 — the day The Inquirer requested information from Glu about Chika’s license — Glu posted handwritten notes on the front door stating that alcohol would not be served until the license was renewed.

Izakaya Fishtown had also been serving cocktails, beer, and wine since its liquor license expired on Oct. 31, 2023. A state police spokesperson told The Inquirer that officers had visited the restaurant in early February and that an investigation was underway.

Both Figo and the Old City location of New Jersey coffee chain Almost Home General served alcohol through off-premises catering permits since their respective opening dates in October 2021 and May 2024. The state issues these permits to allow bars to cater off-site events, not to cover day-to-day service at a bar or restaurant.

“We went into things knowing that [these two restaurants] were going to operate using off-premises licenses until we could officiate a transfer” to bona-fide licenses that never materialized, Lu said.

Ultimately, said Gibbons, Glu decided it wasn’t worth moving forward with obtaining or renewing licenses at any of their restaurants.

Neither Lu nor Gibbons said they know what they plan to do post-Glu. Lu, 43, said he mortgaged his home in Havertown at one point in an attempt to keep Glu afloat. Gibbons, 36, a restaurant industry lifer, hopes to eventually be in a place to try again with a smaller venture.

“Our hope with Glu was that maybe some of these restaurants would become some type of brand with a variety of offerings,” Lu said. “I think as we became bigger, we took on too much.”