COLONIE — An owner of Koto Hibachi and Sushi on Wolf Road is suing his business partners, alleging that they took out unauthorized loans and forged his signature to purchase a property in Wilton, intending to establish a competing restaurant, according to a lawsuit filed Monday in Albany County.
Plaintiff Yilu Lin claims in the suit that partners You Chen and Tehen Yu engaged in illegal and fraudulent conduct, mismanaging the Koto Hibachi Sushi Restaurant corporation’s finances and paying themselves unapproved wages and dividends.
Lin also claimed that he tried to avoid a lawsuit and sell his shares of the corporation, however, Chen and Yu refused to disclose the corporation’s financial records and tried to buy him out at an unfair price.
Represented by the Albany-based Wagoner Firm, Lin is calling for Koto to be judicially dissolved and for an accounting of the company’s finances.
The Koto corporation was originally formed to own and operate a Japanese hibachi and sushi restaurant, which it has done since June 2013, according to the lawsuit. However, Lin alleges that Yu and Chen fraudulently secured a Small Business Administration Loan of $1,995,000 to buy property in Wilton.
Additionally, and without authorization, Chen and Yu took out a $500,000 mortgage in Koto’s name from Chemung Canal Trust Company and forged Lin’s signature, according to the lawsuit. The complaint goes on to detail allegations that they fraudulently took out a $350,000 mortgage from the Capital Region Chamber of Commerce, Inc.
Chen and Yu also did not disclose their intent to purchase the Wilton property and establish Haru Japanese Restaurant on Old Gick Road, according to the allegations in the suit.
The Wagoner firm is “looking forward to vindicating our client’s rights,” said founder Matthew Wagoner.