Business Partners File Fraud Lawsuit Against Jersey City’s Grove Square

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Grove Corner Bar Chris Fry
Grove Corner Bar in Jersey City as seen on Wednesday, November 29, 2017. Photo by Chris Fry/Jersey Digs.

A conglomerate of restaurants located near the Grove Street PATH station is being taken to court for allegedly lying about ongoing problems with their businesses, troubles that include health code violations, maintenance issues, and ongoing tax liabilities.

Grove Square Management, who are based out of East Hanover, recently filed a complaint in Morris County Superior Court against Square Two Holdings LLC and Jeff Favia. Square Two and Favia currently operate five restaurants at 116 Newark Avenue under the Grove Square banner named Bistro Jeffrey’s, Corner Bar, Wine & Whiskey Bar, The Underground, and Favia Pizza.


Grove Square Management claims in the filing that Square Two and Favia entered into an agreement with them last September to transfer over management and operations of the restaurants to them. As part of the deal, the suit says Favia agreed to provide advice on running the restaurants, but Grove Square Management was to have “decision-making authority on all aspects of the business.”

After taking over the eateries, Grove Square Management says it became obvious that Favia “made numerous misrepresentations about the condition of the Grove Square restaurants.” The company claims that one of the most significant was Favia’s failure to disclose necessary repairs that were needed at the property, which ended up costing Grove Square about $100,000, according to the complaint.


In addition, the lawsuit claims that Favia intentionally concealed “past violations with the New Jersey Division of Alcoholic Beverage Control” and “ongoing violations with the State of New Jersey authorities regarding sales tax and payroll tax.” The company also says that Favia “failed to disclose ongoing health code violations” at the restaurants and problems with the city regarding a permit for their outdoor patio area.

Grove Square claims they eventually discovered “rampant ongoing employee theft” while managing the restaurants and a “lack of qualified management, chefs, or waitstaff.” The company’s job was made more difficult, according to the filing, by Favia “repeatedly and materially interfer[ing] with the operations,” conduct that included “becoming belligerent towards customers and employees” and interfering with discussions with the property’s landlord.

Grove Square claims that Favia’s misrepresentation of the businesses, in addition to his conduct, hurt their profitability and caused them to suffer $250,000 in losses between January and April of this year. The company says that to stop the bleeding, they agreed to amend the management agreement in May to permit Favia to operate the restaurant again “for an undetermined period of time” in exchange for the company being paid a percentage of the profits.

The agreement allegedly stated that at some point, management would be turned back over to Grove Square. But the company claims that not only has Favia “retained all the significant profits generated” since taking the businesses back over, he admitted to them in June that “he never had any intention of amending the Management Agreement, and that such intentional misrepresentation by him was a ruse to re-take management operations” of the restaurants.

Square Two has not yet returned our request for comment on the allegations in the lawsuit, which was filed on October 2. Grove Square Management seeks damages from Square Two and Favia for breach of contract, fraud, and unjust enrichment. A court date hasn’t been set, and all of the restaurants under the company’s umbrella have continued to remain open.

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12 COMMENTS

  1. What a complete waste of prime real estate. Imagine a cute french style bistro, maybe a creative brewery, or a nice wine/cocktail bar as you walk out of the PATH. Instead you have these run down dive bars serving garbage food and drinks most likely run by some rich fools who don’t know the first thing about the hospitality business.

      • What’s wrong? Did you get confused by the article? Or couldn’t comprehend what I wrote? Let me hold your hand through it…

        “ As part of the deal, the suit says Favia agreed to provide advice on running the restaurants, but Grove Square Management was to have “decision-making authority on all aspects of the business.”

        So the new owner was seeking advice from the old owner on how to run the operation…it disaster corner. Does that sound like someone experienced in hospitality or someone with big plans to change it?

  2. First of all, there are FIVE restaurants in that one not-terribly-large space? I always assumed it was just one kinda disjointed thing. Anyway, the whole place has always been very unappealing to me as I’ve walked by. Very generic and Hoboken-esque. And now I learn they’re shady, too? Not surprising.

    • Its all the same toxic ownership. They can’t nail down one type of cuisine, so you can imagine the train wreck.

      They have employees giving out drink samples trying to lure tourists / traffic in a la little italy.

      Been there 3x…all horrible. I also heard they treat their employees and staff terribly.

  3. Owner Jeff Favia has a long history of shady business dealings. Back to his days in Hob as owner of Favia Lite, when he ran JC bar York street Tavern, as owner of Powerhouse Lounge, and now this Grove Square disaster.

    The common theme of all his businesses: lacking cashflow to make payroll, unpaid payroll taxes, unpaid sales taxes, not filing income taxes, not paying his distributors, health code violations, mad employee turnover, with a dash of racism thrown in for good measure.

    Next time you see him, ask him why he had to move to Florida for a few years.

    It’s been clear for several years he has been struggling to make rent on this latest venture. Won’t be long now until that place is sold and repurposed. Thankfully

    • Brandon – ave atque vale – your report will not last here online for long. Mine that describes a personal experience with Jeff’s lack of integrity was deleted. Nothing I said was a violation the TOS. Yours will be too. But to the censor, remember that absolute truth is an absolute defense against legal action for libel.

    • What baffles me is when these crooks like Jeff Favia, or at least at the minimum slimeballs who screw over employees, customers and the city get opportunity after opportunity to do it again. Seems he’s had 4 or 5 different businesses that all collapse due to his negligence and toxic behavior; yet he still gets loans and permits to do it again and again?

    • Brandon, it’s a shame people like you can hide behind a computer and put out FAKE NEWS to try to intentionally hurt people and ruin their lives, I think it is safe to assume you are a coward and a loser who failed to meet up to your life’s goals and take satisfaction out of putting other people down using false narratives while hiding in your run down rented apartment like the loser you are.

      You stalk Jeff’s life like a bitter ex girlfriend maybe that is who you are, well in your stalking your facts are all incorrect and I would suggest going to therapy to find out how to get your own life going and really determining why you are such an obsessed stalking loser.

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