December 26, 1996–January 2, 1997

hit and run

Blatstein's Back In Bankruptcy

Almost seven years after Ricky Blatstein folded a rock 'n' roll empire amid a trail of bounced checks, unpaid taxes and angry associates, the one-time boy wonder of Philly's nightlife scene must pay the piper.

Which is why Blatstein filed for personal bankruptcy in federal court on Dec. 19.

According to U.S. Bankruptcy Court documents, Eric J. Blatstein cited a $2.7 million judgment against him when seeking court protection under Chapter 7 of the bankruptcy code. Blatstein owes the $2.7 million to 718 Arch Street Associates, a group headed by real estate investor Gie Liem.

The debt, for which Blatstein is held personally responsible, stems from a broken lease at the former Phoenix nightclub at Seventh and Arch Streets.

Blatstein, known in the '80s for his wild partying and outrageous behavior, did not return calls seeking comment on the filing.

It is unclear how the bankruptcy case will affect Blatstein's other business holdings or his personal property. Via separate corporations under his control, Blatstein currently operates four Delaware Avenue entities — Maui, Philly Rock Cafe, Engine 46 Steak House and the Margarita Cafe. In addition, Blatstein and his family maintain a comfortable lifestyle on the 26-acre, $550,000 "Hideaway Ranch" in Newtown Township.

Other dealings may affect Blatstein's case. According to court documents, Philly Rock Cafe's ownership has changed hands. Main Inc., the corporation which owns Philly Rock Cafe, is listed as a co-debtor in documents. But Blatstein is no longer president of Main Inc. even though records at the Department of State say otherwise. Instead, Morris Lift — a one-time Blatstein accountant — is named as president of Main Inc. in various court filings.

And Main Inc., which grossed $1.6 million in 1994 and $3.35 million in 1995, filed for Chapter 11 bankruptcy protection Sept. 20. In April, 718 Arch Street Associates seized $56,000 from Main Inc.'s Jefferson Bank account.

Instead, Blatstein formed a new company to operate Philly Rock. According to documents at the Department of State's corporate records bureau, Blatstein incorporated Columbusco Inc. on May 2. Blatstein is listed a chief executive officer, president and treasurer of the entity which now operates Philly Rock Cafe.

In the meantime, documents from Main Inc.'s bankruptcy filing show that corporation owes the Internal Revenue Service $76,000 in unpaid Philly Rock Cafe taxes, plus "unknown" claims to the State Department of Revenue, the State Department of Labor and Industry and the city. Other records place the city's claim against Philly Rock at $42,337 in unpaid taxes through June 1996. In addition, Lift claims his own debt of $500,000.

Lift referred City Paper's questions to Blatstein.

Blatstein's latest woes extend beyond bankruptcy. In separate litigation, Louis Manacello seeks a claim of over $50,000 from Main Inc. following an alleged slip-and-fall in October 1994 at Philly Rock Cafe. And in two other lawsuits, Philly Rock Cafe/Main Inc. is named as one of three bars who served alcohol to Angelo Auddino Jr., a bartender and waiter at La Vigna restaurant, on Sept. 11, 1994.

Auddino, 31, is serving a 13-year jail sentence in New Jersey for killing Linda Carosella, a 32-year-old pregnant woman, in a drunken driving accident on that date. After fighting with his girlfriend, Auddino drove his Chevy Blazer onto the Black Horse Pike in Camden County, then veered off the road into Carosella's stalled car. Carosella's 4-year-old son and 50-year-old mother also sustained serious injuries in the accident.

Police said tests showed Auddino's blood-alcohol level to be .236 percent, more than twice the legal standard for drunkeness.

— Scott Farmelant