Owners of State Street Grill accused of not paying, paying less than minimum wage to workers

State Street Grill shut down in December

SAN DIEGO - A 61-year-old restaurateur and his 27-year-old son, who are accused of hiring college students and others, then refusing to pay them or paying them less than minimum wage, pleaded not guilty Tuesday to a raft
of crimes.

The father, David Dadon, and son, Barry Dadon, are charged with workers' compensation premium fraud, payroll tax evasion, sales tax evasion and grand theft of labor involving 23 victims.

David Dadon -- held on $500,000 bail -- also was indicted on a count of fraudulently removing property under a lease and two counts of attempted extortion. If convicted as charged, he faces up to 21 years in prison, District Attorney Bonnie Dumanis stated.

Barry Dadon, arraigned Thursday, pleaded not guilty to the charges and was released on$200,000 bail. He faces up to 18 years behind bars if convicted.

The defendants will be back in court May 21 for a readiness conference and May 29 for trial.

Dumanis alleged the Dadons victimized more than 20 servers and cooks for over a two-year period at State Street Grill in the College area. The defendants allegedly refused to pay the workers after a week of work or offer them a wage that amounted to less than $5 per hour.

"The defendants in this case repeatedly took advantage of victims who were in desperate need of income and who accepted an offer to work during a 'trainee period,'" Dumanis said. "The estimated loss in this case exceeds $350,000, and we're encouraging any additional victims of this heartless scheme to come forward."

The alleged victims were hired to work at State Street Grill through ads placed on Craigslist. According to Dumanis, the defendants offered job applicants positions if they agreed to work without pay for the first seven
days. The applicants were told if they performed well during the "training period," they would be put on the payroll and paid wages, she said.

The victims described working in excess of 40 hours per week and were never paid, Dumanis said, noting in addition, the Dadons took some of the tips the workers earned.

Victims who were hired after the first seven days continued to work in excess of 40 hours a week but were fired if they refused to accept less than minimum wage pay, she said.

The defendants also collected $108,000 in sales tax from their customers' bills and kept it for themselves, according to Michelle Steel of the state Board of Equalization.

State Street Grill closed in December.

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