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Blue Blood

Brian Podwinski, president and founder of Blue Blood Brewing Co., gives a tour of Robber's Cave when Blue Blood opened in 2016. 

The story of how Blue Blood Brewing got to the point of abruptly shutting down in May started quite a bit earlier — it started before the brewery even opened in 2016 at the site of Robber's Cave near 10th and High streets.

Blue Blood founder and owner Brian Podwinski said construction costs for the building housing his brewing operation and a restaurant wound up being almost double what was estimated.

During the construction process, he sold the property to Robbers Cave LLC and leased it back, winding up with lease payments higher than what he had planned for.

However, he said the business did well for about two years and the payments were not a problem.

Up until late 2018, Podwinski said he was actually looking at expanding.

Then the harsh winter started to put a damper on business.

Podwinski said November was "just a crusher." December wasn't great. January was bad and February was "horrendous."

At about the same time, there also was a technical issue with a business filing, which caused Blue Blood's bank to threaten to shut down the business.

Then in April, Podwinski said he had a health scare.

All of those issues convinced him it was time to get out of the business.

He had been looking into selling and had a buyer lined up, but he was concerned his landlord might shut him down because he had fallen behind on his lease payments.

Robbers Cave LLC had filed a lawsuit against Blue Blood in March over $26,000 in unpaid rent.

So Podwinski said he met with his landlord and his lender in late April and explained he was working to sell the business and wanted to be able to wind down in an orderly fashion.

He said he received assurances from Robbers Cave LLC officials they would not shut him down.

That's why it came as a shock to Podwinski when Robbers Cave LLC evicted Blue Blood from the property on May 16, forcing the restaurant and brewing operation to close abruptly.

That abrupt shutdown has led to five additional lawsuits against the business over the past couple of months from individuals and businesses who are owed money.

A Lincoln judge last week approved a $50,000 judgment against Blue Blood in a lawsuit filed by Ironhide Construction, which alleged the company had "failed to operate the business in the same manner as described" in the loan agreement.

Attorney Craig Dirrim told Lancaster County District Judge Jodi Nelson that Blue Blood and Podwinski had stipulated to the entry of a $50,000 judgment over a loan made to Blue Blood last fall.

Podwinski wasn't in the courtroom for the hearing. Neither was his attorney, Lyle Wheeler, who was out of town for a funeral.

In an interview Tuesday, both Podwinski and Wheeler said they had no issues with the Ironhide lawsuit or the judge's ruling.

The other lawsuits against Blue Blood range from the $25,590 that Robbers Cave LLC is seeking in unpaid rent payments to $575,000 First State Bank Nebraska is seeking on a loan Podwinski, a onetime Lincoln police officer, took out last year.

Together, the suits seek nearly $1.2 million.

On May 31, Charles Tomek, a Lincoln emergency room doctor, filed two lawsuits — one against a subsidiary company, Barrel Aged Labs, the other against Blue Blood Brewing, and both against Podwinski — alleging they collectively owed him $250,000, plus interest and late charges.

On July 17, Tadd Delozier, another Lincoln ER doctor, filed the latest of the suits, saying Barrel Aged Labs, Podwinski and his wife, Amanda, owed him $250,000.

In it, Delozier's attorney, Brian Kruse, said Barrel Aged "was and is grossly and inadequately capitalized," and alleged the Podwinskis had diverted entity funds or assets to their own use or improper uses.

Tomek's lawyer, Michael Milone, alleged the same against Podwinski in that lawsuit. 

In that case, Milone said Blue Blood had paid back less than $16,000 on a $150,000 loan and made no payments on a $100,000 loan. With interest and late fees, he says Tomek is owed more than $300,000.

Nelson agreed to continue a hearing that had been set in the Tomek cases.

Nelson in late June ordered the return of all alcohol inventory or finished alcohol products Blue Blood had remaining in cans, bottles, kegs and barrels that were used as collateral on the First State Bank loan.

Podwinski said the lawsuits are all the result of the sudden closing and wouldn't have been necessary if he had been allowed to sell the business.

"If we would have been able to work through that like I had asked and they had agreed to, I don't see us having any issues on taking care of pretty much everything," Podwinski said.

Now, he and his attorney are planning to challenge some of the lawsuits.

Most of the challenges will be minor, such as disputing a valuation or which business entity owes the money.

However, Podwinski does plan for a court fight over the suit filed by Robbers Cave LLC and whether Blue Blood should have to pay the balance of the rent on its lease.

An argument that's likely to be made is that the landlord's own actions caused Blue Blood to fail.

"There were lucrative and viable offers on the table for acquisition (of Blue Blood) that were denied for reasons that were unknown to us, and it doesn't make business sense," Wheeler said.

He called the situation a "mess" and said the discovery portion of the case will be necessary to evaluate what exactly happened.

Greg Frayser, the attorney for Robbers Cave LLC, said Blue Blood's failure to keep up on the rent is the sole reason it closed.

"From at least the spring of 2018 through May of 2019, Blue Blood Brewing Company Inc. was delinquent on required payments under its lease agreement with Robbers Cave LLC. Robbers Cave worked with Blue Blood for over a year, attempting to allow it to cure its multiple defaults. Ultimately, and despite multiple opportunities, Blue Blood was unable to cure its defaults," Frayser said in an email.

"I understand that Blue Blood contends that Robbers Cave is responsible for its closure and as a result it is not liable for amounts which remain due under the lease. In fact, Blue Blood’s failure to pay rent is the sole reason it closed. Ultimately, the court will determine Blue Blood’s liability and my client is confident in its legal position."

For his part, Podwinski said he could have just filed bankruptcy the day he was shut down and let his creditors fight over the assets.

"I'm trying to do the right thing and make sure everybody is taken care of," he said.

Inside Robber's Cave

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Reach Matt Olberding at 402-473-2647 or molberding@journalstar.com.

On Twitter @LincolnBizBuzz.

Reach Lori Pilger at 402-473-7237 or lpilger@journalstar.com.

On Twitter @LJSpilger.

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Business editor/reporter

Matt Olberding is a Lincoln native and University of Nebraska-Lincoln graduate who has been covering business for the Journal Star since 2005.

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