City Paper is not for tourists
Some restaurateurs have a love-hate relationship with reservations site OpenTable. The platform with about 50,000 participating restaurants worldwide gets butts in seats, but charges restaurants for every reservation made. For Robert Wiedmaier, that relationship is a lot more complicated.
The longtime D.C. chef behind Marcel’s, Brasserie Beck, Mussel Bar, and other local venues is suing OpenTable for $4.12 million. Parent company Booking Holdings Inc. and OpenTable founder Chuck Templeton are also named as defendants in the suit filed April 16.
The case hinges on a promise that was made after the site crashed and two pieces of paper Wiedmaier can’t find.
Wiedmaier and OpenTable came up around the same time. Templeton founded the company in San Francisco in 1998 and quickly expanded to Chicago and D.C. In 1999, Wiedmaier opened the doors at what is still his flagship, fine-dining restaurant, Marcel’s. The complaint alleges that OpenTable needed Wiedmaier just as much if not more than Wiedmaier needed OpenTable to find early success. Marcel’s was one of the first restaurants to use the platform locally, starting in 2001.
“As a startup, OpenTable used Mr. Wiedmaier as an ‘influencer’—a well-known restaurateur whose early use and promotion of OpenTable’s restaurant reservation services helped the company establish itself in the Washington, D.C. area,” the complaint reads, adding that representatives from the company would bring other restaurateurs by to see how the system worked.
Further, the complaint says OpenTable wouldn’t be where it is today without Wiedmaier. “As in life, in the restaurant business restaurateurs tend to want to emulate the popular crowd,” it reads. “OpenTable parlayed its status as the reservation management system for influencer restaurants to rapidly gain market share among restaurants in a given city.”
But the relationship soured quickly when, according to the complaint, OpenTable crashed one night in 2001, leaving Marcel’s staff scrambling when diners arrived. Wiedmaier argues that it caused him to lose business and was peeved enough to tell OpenTable’s then Director of Strategic Accounts Michael Schell that he was through with the company. Wiedmaier also relayed that he planned to tell his “colleagues in the restaurant community about what happened and would suggest they not use OpenTable either.”
To salvage the situation, Templeton visited Marcel’s to meet with Wiedmaier, according to complaint. “In exchange for Mr. Wiedmaier continuing to use OpenTable at Marcel’s Mr. Templeton offered Mr. Wiedmaier shares in OpenTable and a reduction in perpetuity for certain OpenTable fees.” Specifically Wiedmaier claims Templeton handed him two pieces of paper. One offered him 40,000 shares, the other the fee reduction. Wiedmaier cannot find these documents.
It turns out those 40,000 shares are valuable. Priceline made a tender offer to OpenTable’s shareholders to purchase all of the shares of common stock of OpenTable at $103 per share when it purchased the company for $2.6 billion in 2014. 40,000 X $103 = $4.12 million, the precise amount Wiedmaier is asking for in his lawsuit.
According to the complaint, Wiedmaier reached out to OpenTable in 2017 after learning of Priceline’s purchase of OpenTable to investigate the status of his shares. He sent a letter that included testimonials from Schell; Marcel’s general manager at the time who was at the meeting; and a food runner who witnessed the meeting.
No deal, said OpenTable about a month later, according to the complaint, which also alleges OpenTable conducted an investigation that did not involve contacting Schell or anyone else mentioned in the letter.
City Paper requested the letter from Wiedmaier’s attorneys, who opted to provide only the following statement:
“As an early OpenTable ambassador and one of the first chefs to use the service in the region, Robert Wiedmaier was critical to OpenTable’s success in Washington, D.C. OpenTable promised him that he would share in the company’s success, and awarded him shares in the company for his efforts. But when it was time to make good on that promise, the company turned its back on him. Mr. Wiedmaier brought this lawsuit to hold OpenTable to its word.”
Wiedmaier continues to enjoy the benefit of lower fees on the platform, which the complaint seems to offer as proof that some sort of deal was struck at the meeting following the incident where the site crashed. The restaurateur is suing for breach of contract and something called promissory estoppel—a legal principle that a party “may recover on the basis of a promise made when the party’s reliance on that promise was reasonable, and the party attempting to recover detrimentally relied on the promise.”
OpenTable did not respond to City Paper’s requests for comment. Wiedmaier declined to comment because the case is active.