Dave's Produce has barely survived the alleged bad debt from Pontillo's
Submitted by Howard Owens on April 20, 2010 - 6:45pm
Kathy Pettinella says in November 2008, she almost lost her business -- a business started and built by her late husband and late son 15 years ago.
Her business, Dave's Produce, relies on cash in the bank so she can buy product at farmers' markets and deliver it to local restaurants.
So when one local restaurant allegedly stiffed her for nearly $70,000, it really hurt.
"Oh, my God -- I am done. I’m absolutely done." Pettinella said were her first thoughts when she learned of the original Pontillo's Pizzeria closing. "Looking at all that money, I went through all my bank statements, my deposit slips, I was in trouble. I couldn’t cut back anything anymore out of my household budget."
How and why Pontillo's was allegedly able to run up all that debt is something Kathy still can't fully explain, but until last week, when The Batavian wrote about the debt in a story on financial issues surrounding the Pontillo family and their legendary pizza business, she said nobody in Batavia knew about the debt. It was something she wanted to keep secret.
She said she was shaking the first time she answered a call from The Batavian asking about the debt.
"I was petrified," Pettinella said of her long-standing fear of people finding out about the debt. "I was was afraid people would think, ‘What a stupid woman. That’s why women don’t run businesses because they would drive it into the ground.'"
"That was my initial thought -- that I just made a bad example for the rest of women who are working so hard to run their own small businesses."
Kathy Richardson and Dave Pettinella -- Big Dave, as she calls him -- were together for 27 years. They would eventually have two children together, but never marry. She said Dave was a strong, capable businessman who was good with numbers and taking care of his customers. He founded Dave's Produce when he happened to come across a local restaurant that needed deliveries from farmers' markets in Rochester and Buffalo.
It didn't take long for the business to grow and bring in more clients.
Who hasn't seen the big "Dave's Produce" truck driving around town?
Big Dave died in in July 2007, though, just two years after Dave and Kathy's son, Dave, Jr., died in a car wreck at Daws Corner.
A week after Big Dave died, it was Kathy taking the orders, writing the bills, buying the produce and delivering the product in that big white truck.
She's run Dave's Produce as a one-woman business ever since.
So when Pontillo's managers started calling on her to deliver more than just lettuce and eggplant in March 2008, she couldn't help but think that taking on more responsibility for such a big local business would be a feather in her cap.
She had heard Pontillo's had lost some of its suppliers over unpaid bills, she said, and at that point, there was at least an unpaid balance of $10,000 owed to Dave's Produce, but she wanted to believe that eventually Paul and Sam Pontillo would get caught up and pay off what they owed.
"That’s the sad thing about it," Kathy said. "Yeah, by the time summer came around, Pontillo's was way in debt with me, but then the other vendors shut them off. And I felt bad. Why I felt bad, I don’t know. But I did want to see the business run and I was their main supplier."
Starting in March 2008, Dave's Produce was not just making two deliveries a week to Pontillo's in Batavia, but three, and the average monthly order went from $2,000 to $3,000 range to more than $10,000, according to invoices Kathy Pettinella provided to The Batavian for review.
Some of the invoices were paid -- usually for only a few hundred dollars, at most, but all of April 2008 was paid.
Dave's Produce went from delivering fruits and vegetables to within weeks of the first time of being asked to pick up some wings and BBQ sauce to bringing in just about all the product Pontillo's needed, including all the meat and mozzarella.
"I could get them anything they needed," Kathy said.
What she couldn't understand was, Pontillo's was obviously bustling with business, so why wasn't she getting paid?
"It would have been so much less of a headache," Kathy said, "to shut them off and say, ‘you know, you treated the guys in Buffalo and other areas real bad. Your checks are bouncing for them as much as they are for me. All this money I’m paying for the product, these other vendors are paying for the product, and you’ve got all these customers paying for the product – where’s the money going? Where is the money going?'"
It's the same question John Pontillo said he's put to his brothers, Sam and Paul, but he's never gotten an answer either.
Paul, however, says Kathy Pettinella is lying.
"I don't care what she confirmed, she's lying," Paul Pontillo said when first asked about the debt a week ago. "Ly-ing. Lying. OK? It's nonsense. We spent three hundred bucks a week with her. Produce. How many weeks would she let us go to come up with this number?"
The invoices show that even before Dave's Produce became the main supplier for Pontillo's, the restaurant was putting in orders for $500 to $600 per week.
Paul Pontillo apparently signed one of the invoices, and Sam Pontillo appears to have signed another, but the rest were signed by managers.
It was Paul, though, according to Pettinella, who was responsible for making payment.
According to Pettinella, if she ever got a check it would bounce, and then she would spend three weeks trying to get in touch with Paul, who would then pay off some of the bounced check with cash and issue a new check for the next invoice, but then that check would bounce.
"Pauly would say, ‘you’re going to get $1,000,'" Pettinella said. "Well, by the time I get the money from the night manager, there’s not $1,000 in that envelope. There’s $500. But you try to call Paul and there’s no way he’s going to pick up the phone."
Shortly after Kathy Pettinella sat down for an interview with The Batavian on Saturday, she stopped in at Wilson Farms on East Main Street, across the road from the recently reopened Pontillo's Pizzeria, and as she was leaving the store, she stopped Paul Pontillo walking on the sidewalk.
She approached Paul -- talking to him for the first time since the original Pontillo's closed -- and asked him about calling her a liar. She then called me and said Paul wanted to talk some more, but rather than try to arrange a three-way interview over the phone, since I was already in my truck and in the area, I just stopped by to talk with both of them.
When I arrived, Kathy and Paul were yelling at each other. Paul was heatedly denying the extent of the debt Pettinella said Pontillo's owed Dave's Produce.
Paul Pontillo said there was no way the restaurant ran up that much debt to Dave's Produce, and he also accused Kathy of not being fully cooperative in settling the debt.
"I asked you for copies of the invoices six months before we closed," Pontillo said.
Just an hour before, The Batavian had reviewed invoices provided by Pettinella. The allegedly unpaided invoices spanned from January 2008 to October 2008. Six months prior to the closing would have been May 2008.
A good portion of the $67,750 in bad debt the invoices allegedly show occurred after May 2008, with the entire April 2008 debt being paid off, according to Kathy.
The Batavian first became aware of this alleged bad debt because of a document provided by John Pontillo. He said it was prepared by Sam Pontillo after the restaurant closed, to show just how much debt the business had wrung up. Of the suppliers with outstanding balances, Dave's Produce was by far the largest.
The document lists the amount owed at $68,421.75.
Paul Pontillo vehemately disputed that figure, and has continued to dispute it, since first being showed the document. He said that at most, Pontillo's owed Dave's Produce $3,000 or $4,000.
In another interview this week, Paul said the level of debt Pontillo's had at the time it closed would be normal for a business that just shut its doors. He said if the financial figures were available for South Beach, when it closed, or Cristina's, when it burned down, those documents would show a similar amount of unpaid bills.
"That's just what happens when you go out of business," Paul said.
The debt, he said, is really an old issue. He thinks The Batavian should be paying closer attention to the conduct of the estate's administrator, John Forsyth.
While Paul Pontillo is clearly the one Kathy Pettinella blames -- she said John did try to repeatedly warn her -- for the bad debt, she said Sam Pontillo knew what was going on (he did apparently sign one of the invoices), and she also had her own problems with Sam at his Le Roy restaurant.
Pettinella produced a copy of an allegedly bounced check from Sam and said it was shortly after that -- in March 2009 -- that she stopped deliveries to the Le Roy Pontillo's, though the bounced check and other debts associated with the Le Roy store were eventually paid, she said.
She said Paul Pontillo was well aware of her situation and that he and Sam "saw her coming." They took advantage of her, she said.
"For Pauly Pontillo to turn around and do this to me – I just never would have thought it," Pettinella said. "I just never would have thought, for somebody to be that evil. I wasn’t in the right state of mind. I wasn’t paying attention. I didn’t want to be mean. I didn’t want to hurt anybody. But you can’t be (that way) in a business -- business is business, it’s not personal. I just wasn’t looking out for myself."
Pettinella said no other small business owner in Batavia has even come close to running up any kind of big debt to Dave's Produce, which is part of the reason she said she was so trusting of the Pontillos.
"The people here in Genesee County, in Batavia, they’re wonderful," Kathy said. "They just support local business and they’re so good. We have a strong community. Business owners here in Batavia, their integrity is high. They’re … I’m just at a loss for words – they’re just amazing here.”
When asked again to explain how it happened, how the alleged debt was ran up to $67,750 in just 10 months, Kathy Pettinella tries again to answer and then says, “That still doesn’t answer your question, why did it keep going on so long? I just kept looking for the grace. I just kept thinking, things will turn around. People can’t be that evil. Wrong."