Gallagher’s Files for Bankruptcy : Trendy West Side Restaurant Lost Lease; No Buyer Found

The decor was simple and the ambiance was trendy, but what was once in with the in crowd is now down and out near Beverly Hills: Kathy Gallagher Bar Restaurant, a formerly favored spot by many in the entertainment industry, has closed its doors and filed for bankruptcy law protection.

K. M. Gallagher’s Inc., which was doing business as Kathy Gallagher Bar Restaurant, filed March 9 for protection from its creditors under Chapter 7 of the U.S. Bankruptcy Code. Under that provision, the assets of the business are liquidated and distributed to creditors under court direction.

Closed in Early Decenber

Kathy Gallagher closed in early December after owner Kathy Gallagher was unable to renew the lease on the restaurant at 8722 W. 3rd St. and could not sell the business, said Andrew J. Fodo, Gallagher’s lawyer. The business had assets of $85,500 and liabilities of $210,164 as of Feb. 25, according to the bankruptcy filing.

“When she had no lease, she had no choice but to close the restaurant,” Fodo said. “She would have loved to stay.”

Gallagher was unavailable for comment on Monday.

Gallagher, a former New York model and restaurateur, started the bar and restaurant that bore her name in 1980, and it quickly became a hot spot with those in the movie business.

It was rated “top pub” in Los Angeles, according to a mail survey of restaurant-goers by the Zagat Guide. Kathy Gallagher was one of the first in town to pay serious attention to American food, serving such dishes as chicken potpie and veal chops, industry observers noted.

“It was popular with the entertainment industry crowd and a certain amount of ‘artistes,’ ” said Lee Helper, who specializes in entertainment public relations. “It was a good place to go and get good, wholesome food.

“But there are so many places to eat in Los Angeles, and when a place is a favorite you mourn its loss for maybe three weeks,” he said. “I think the loyalty is strong until the next place comes along and catches your fancy.”