Secret Sandwich Society’s longtime home at 501 E. Grace St. in downtown Richmond has closed for good, and the restaurant’s management says payroll owed to employees will finally go out by Monday, Oct. 26. The shutdown caps months of turmoil involving unpaid wages, a dispute between the restaurant’s operators and the brand’s owners, and now a federal lawsuit accusing the Richmond operators of siphoning roughly $2 million out of the business.
The closure was confirmed by management, which told 12 On Your Side that the Grace Street restaurant had shut down permanently and that payroll would be distributed by the end of the day Monday. The downtown spot first opened in 2016 and was taken over in 2022 by Michael and Nicole Sloane and their company, Society Hospitality LLC, according to the same report. Michael Sloane told the Richmond Times-Dispatch that all employees would be paid in full, 12 On Your Side reported, though the Times-Dispatch report on the closure and lawsuit can be read at Richmond Times-Dispatch.
Investor Accuses Owners of Diverting Millions
The closure comes just two days after investor Sami Ghareeb filed a federal lawsuit accusing Michael and Nicole Sloane and affiliated entities of taking at least $2 million from Society Hospitality LLC. Ghareeb filed the suit Oct. 21 in the U.S. District Court for the Southern District of West Virginia, case No. 2:26-cv-00676, according to Legal Newsline. The complaint alleges the defendants extracted “approximately, and likely in well in excess of, Two Million Dollars” through a mix of distributions and transactions later characterized as loans, while preferred investors went without payouts.
Legal Newsline’s report notes the complaint asserts breach of contract, fraud, breach of fiduciary duty, and violations of the federal Racketeer Influenced and Corrupt Organizations Act. Ghareeb says he owns 6.75% of Society Hospitality and that preferred investors have received no distributions since August 2022. The lawsuit also claims the defendants used company credit cards for unreimbursed personal expenses and routinely pulled cash from the restaurant.
The complaint cites financial figures pulled from company records, including roughly $3.18 million in 2023 gross receipts against $213,181 in purported net distributions to TLT Group, the same outlet reports. It also points to a 2025 balance sheet listing an $825,180.47 “TLT Group LLC Note Receivable,” which Ghareeb alleges represented distributions improperly recast as a loan. None of the allegations have been proven in court.
Back Taxes and a Brand Dispute Added to the Pressure
Compounding the financial strain, a notice from the Department of Taxation stated that Society Hospitality LLC owed $119,419.14 in back taxes, according to WRIC. The notice said the business had been closed and its property distrained for nonpayment of Virginia taxes, with a memorandum of lien recorded.
Beyond the tax issue, WRIC’s report also details a separate rift between Society Hospitality and the owners of the Secret Sandwich Society brand, who said they had terminated the Richmond location’s license and demanded it stop operating under the brand name. According to 12 On Your Side, the brand owners said in a statement, “We have terminated its operators’ authorization to use the Secret Sandwich Society name and branding, and that dispute is pending in court.”
Workers Say Wages Have Been Owed For Weeks
Employees had reported as of Oct. 22 that their most recent wages remained unpaid, and signs were posted at the restaurant entrance that day notifying customers of the closure, per the Richmond Times-Dispatch report. The notice at the entrance reportedly thanked customers and said the restaurant would be closed until further notice. Restaurant management acknowledged that wages were overdue and apologized for the delay and uncertainty, while saying it was working to secure the funds needed to pay workers.
Under Virginia law, employers generally cannot withhold wages except for payroll or withholding taxes required by law or with an employee’s written authorization, per Virginia Code § 40.1-29. Separate state statute allows Virginia’s Commissioner of Labor to look into nonpayment complaints involving other employees of the same employer, according to Virginia Code § 40.1-29.1.
The Richmond location was not the brand’s only outpost — the original Secret Sandwich Society restaurant opened in Fayetteville, West Virginia, in 2010, six years before the Richmond shop debuted, according to Legal Newsline. That outlet also noted the federal lawsuit concerns only the Richmond restaurant, not the original Fayetteville location. It remains unclear whether employees will receive the promised payroll by the Oct. 26 deadline management set.
