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Mortgage broker Kirk Apazeller says he is the rightful owner of Red, the six-month-old eatery on Washington Avenue. So does landscaper Derek Onstott. Apazeller says he designed the place, drawing inspiration from a handful of coffee-table books on cool club and restaurant designs. Onstott tells the same story.

A year ago the native southern Illinoisans — Apazeller, 34, and Onstott, 29 — envisioned Red as both restaurant and lounge, with a DJ booth, a baby grand piano and a shimmering, candy apple-colored bar. They hoped the place would make a name for what they termed "eclectic American cuisine with an Eastern European flair." Now the former bar buddies are locking each other out of the restaurant in what's become an increasingly bitter battle that has both of them seeing red.

Amid allegations of violence, drug abuse and corporate mismanagement, Apazeller and Onstott have each gone to court claiming ownership of the venture, and each has asked a judge to halt the other from interfering. As of 2 p.m., February 25, Red was closed until further notice. One of the men had the keys; the other had the security-alarm code. "He's depleted my morale, my finances and my staff," says Apazeller. "This thing is a tornado," says Onstott in a separate conversation.

Red opened last September to enthusiastic food reviews from both the Post-Dispatch and Riverfront Times. Its dark and sexy décor — not to mention the red bustiers worn by the female wait staff — drew many partying night owls. By both partners' accounts, Red did gangbusters business in the beginning. Then the tide turned.

Onstott says Apazeller was the problem. "I thought he had a following of people, but it was the wrong crowd," he complains. "He wanted a nightclub with DJs. I wanted an upscale restaurant lounge with $30 steaks. Your diners don't want to hear techno while they're eating their $30 steak."

Apazeller says it was Onstott who scared away patrons. In a petition for a temporary restraining order filed in St. Louis Circuit Court in December, Apazeller stated that Onstott brandished a loaded gun to Red's employees and customers, threatened physical violence against an employee and stole food and liquor. He also said that Onstott bought and sold illegal drugs on the premises. In an accompanying affidavit, Apazeller reported that Onstott "has entered the kitchen with a handful of cocaine and asked for a plastic baggy."

Onstott vigorously denies each accusation. "He made all that stuff up because a judge is not going to sign a restraining order if he just says, 'Derek threatened to beat me up.' With guns and drugs, a judge can't say no, because if something happened afterward, it would be the judge's fault."

Apazeller has also stated in court papers that Onstott threatened his life numerous times, to which Onstott responds: "Like I told Kirk, 'That's bullshit.'"

St. Louis Circuit Court Judge John Garvey granted Apazeller a temporary restraining order which bars Onstott from coming within 1,000 feet of Red and from approaching Apazeller. But Onstott appealed to the judge, alleging that Red had not paid sales taxes, payroll taxes or rent, and complained that Apazeller moved more than $25,000 of restaurant assets into a new bank account that Onstott couldn't access. Judge Garvey subsequently appointed an arbitrator to inspect the books and ordered Apazeller to post a $325,000 bond. Apazeller couldn't come up with enough money for the bond and dropped the case on January 28.

That same day, St. Louis police arrested Onstott for allegedly destroying property at Red. According to the misdemeanor charge, he kicked in the restaurant's glass door the night before.

On January 30, Onstott was released on bond and proceeded to file his own lawsuit, asking for a restraining order against Apazeller. Onstott alleged Apazeller gave away Red's food and alcohol, purchased and sold narcotics at Red, and allowed the bar's employees to do drugs and booze before, during and after work. "One hundred percent absolutely false," counters Apazeller.

Whatever the nasty allegations, the crux of the court dispute comes down to one basic question: Who owns the restaurant?

During a recent interview Onstott displays an operating agreement for Red's LLC, Contemporary Foods, which identifies him as majority owner, with an 80 percent stake. Onstott says he sunk $720,000 into starting Red and that he offered Apazeller a 20 percent share without any money down. Onstott claims he obtained his cash after selling an auto business in his native Belleville.

"Neither Derek nor Kirk is any choir boy," allows Patty Wilcox, Onstott's attorney. "But there's no dispute that Derek put the money in, and for Kirk to lock him out is pretty ridiculous."

In a separate conversation, Apazeller acknowledges Onstott's investment but says the promissory note amounted to $325,000 and that only $125,000 has been deposited into Red's account. Apazeller says he put in $10,000 and shows documents indicating he incorporated Contemporary Foods as the sole member. He offers up the restaurant lease, executed with Contemporary Foods and signed by him, as well as the liquor license, which he acquired. "We don't believe Derek's [document] is a true operating agreement," sums up Apazeller's attorney, Jeff Witt. "All of Derek's paperwork is at issue."

On February 13 the feud escalated when the former partners met with their attorneys. To Onstott's and his lawyer Wilcox's surprise, Milton "Skip" Ohlsen also took a seat at the table. According to Onstott and Wilcox, Ohlsen claimed he had purchased Red's contents, as well as its name, from Apazeller and said he intended to "lease" everything back to Apazeller. "Skip tried to insinuate himself into this," says Wilcox. "He threatened to come with a truck and haul all the equipment off. I said, 'I don't know who's inviting you from a legal perspective, but go ahead!'

"He would not tell us the exact amount he apparently paid, only that it was around $50,000," continues Wilcox. "I said, 'Where did the money go?' They said it went to pay attorneys' fees. To me, that has a bad smell to it."

Write Your Comment show comments (17)

  1. I am not a CROOK!!!!!!!


    RESPECT MY PRIVACY!!!!!!!!

    Comment by Skip Ohlsen — March 5, 2008 @ 03:39PM

  2. Very interesting article. It would seem there is more to this than meets the eye. Mr. Ohlsen does have a knack for finding himself in awkward positions. Is the Riverfront Times
    "out to get him"? He seems to think so. One would think a rational person would avoid putting themselves in such a position. I suppose you reap what you sow. I certainly hope the correct authorities are investigating these allegations. Thanks and kudos to the RFT, your publication is top shelf.

    PMLOL

    Comment by Kracker — March 5, 2008 @ 03:54PM

  3. ^^^^^^


    My attorney and I will see you in court!!!!!!!! NO ONE SPEAKS negatively about SKIP OHLSEN!!!

    Kristen Hinman, I don't like you!!!!!! So there.

    Comment by Skip Ohlsen — March 5, 2008 @ 04:01PM

  4. ^^^^^^


    My attorney and I will see you in court!!!!!!!! NO ONE SPEAKS negatively about SKIP OHLSEN!!!

    Kristen Hinman, I don't like you!!!!!! So there.

    Comment by Skip Ohlsen — March 5, 2008 @ 04:02PM

  5. People sell and use Cocaine at 'Red'?

    I, for one, am shocked.

    Comment by J H — March 5, 2008 @ 05:42PM

  6. This is to serve as another attempt to notify you (Milton H Ohlsen 3rd) that I have yet to receive my w-2 for 2007 or for 2006 for that matter. Please comply with federal law that requires said tax forms to have been post marked by January 31, 2008 and 2007 respectively. Additionally you’ve had sufficient time to remedy my lack of payment for May 2007’s payroll. Feel free to use the self addressed stamped envelopes I sent to both your and your attorney, Jeff Witt’s, office.

    Comment by Pete McElligott — March 6, 2008 @ 03:40PM

  7. 1099 as always, PUNK!!!

    Comment by Skip Ohlsen — March 6, 2008 @ 08:25PM

  8. Well, lets see... in 2004 it was a w-2 and in 2005 it was a w-2. No I think It's a w-2 as always

    Comment by Pete McElligott — March 6, 2008 @ 09:18PM

  9. Funny thing . business ethics seem to be lacking . I would not play into this scenario. wonder who skip is paranoid about this time perhaps he will try to sue the universe for his own existence next. I know for one i would not want to be in his shoes, one can only hope the correct authorities investigate all this cocaine talk in the article. I bet they hit the motherload if they do , just my opinion. Drugs/ convicted felon / guns?? simply amazing it has been allowed to go so far..

    Comment by kracker — March 6, 2008 @ 11:12PM

  10. It's a shame what has happened to RED....I really like that place and the food. I know what has been going on with the situation with Derek Onstott. I have seen him myself act out of control a few times while I was there for dinner and drinks. The people that live here on Washington street know all to well about the actions of Mr. Onstott and most of us have stayed away because of this. I also have known Kirk from coming in there and he has always acted professional and polite. I read this article and its obvious that Mr. Onstott false accusations of Kirk are just an attempt to make him look better. I hope things get resolved and we can enjoy the restaurant again.

    Comment by Rob Stevens — March 13, 2008 @ 06:21PM

  11. That place sucked anyway. Fake wanna be nightclub/restaurant hoodlums that have a little cheese. My take is that they will shoot eachother before this is all over. Red is the color of blood. Another one bites the dust... good for them. They should have made sure they had their ducks in a row before they even set foot into this type of business. THATS why they and many other places WILL fail.... pityfull.

    Comment by Downtown Charlie Brown — March 14, 2008 @ 10:16AM

  12. @ Rob Stevens -

    So you contend that Kirk is innocent? Kirk doesn't use illegal drugs in the club? He doesn't have specific knowledge of patrons and employees alike using drugs at the club? Specifically, which accusations of Mr. Onstott do you claim to be 'false'?

    Do you deny Mr. Onstott's significant investment in Red?

    Derek may not be Mr. Innocent, but I doubt anyone is. From what I read in the article they opened a club - predominetly with Mr. Onstott's money, very little coming from Kirk - and they fueded and as a result the minority investor wanted Mr. Onstott out. Please. If Kirk doesn't like it, being that his investment is so small, perhaps he should hit the road. If you or other Wash Ave regulars don't like Mr. Onstott, then don't go to his club - simple.

    Also, in my estimation, feuds like this are inevitable if a business has any connections to the drug culture and it's being ran by people with connections to the same.

    Comment by J H — March 14, 2008 @ 11:16AM

  13. Okay this article is completely and totally ridiculous! I currently work at RED and I am completely and totally on the side of Kirk Apazeller because I know that Kirk himself doesn't do what Onstott is claiming yet even remotely close. Kirk is one of the most professional and successful self-made businessmen I have ever met. He has always conducted himself with dignity and respect, especially to guests in our restaurant. I dont know has legality over the restaurant but I know for a fact that Kirk deserves it hands down. He is a gentleman and respects the staff with utmost consideration.

    I also have seen personally when Derek was there prior to having a restraining order on him for violence acts towards the restaurant and even busting out the back door glass, he was in the kitchen and trying to fix food without washing his hands and even after licking some food he got on them, still prepared the food and touched it with his bare hands. That is NOT professional NOR is it good for cleanliness and health standards.

    Kirk is a good businessman and my boss. Derek has disrespected me personally on several occasions and has always talked down to almost everyone I have seen. He belittles people and isn't nice by my standards. Respect is earned not given, and Kirk has earned mine completely.

    RED has some of the best food in downtown and I would not let something that has been in the past misdirect people from extraordinary food and excellent service. Come in I promise you amazing service.

    John Stinekraus

    Comment by John Stinekraus — March 15, 2008 @ 01:18AM

  14. and on another note,

    there has NEVER been drug use by any of the staff during or on the premises of the work, neither by myself nor Kirk nor any of the chef's or wait staff. completely ridiculous statement. Derek does drugs himself for fuck sake, seriously if someone is gonna call out someone on drug use they need to check themselves first.

    UGH Kirk i will only work for you at RED no one else.

    Comment by John Stinekraus — March 15, 2008 @ 01:26AM

  15. @ John Stinekraus

    Unfortunatley for Kirk, popularity does not equate to ownership in this country. Ownership should not be, is not and will never be a popularity contest - imagine the consequences of a society built on the rules of high school. That seems to be what you propose. You like Kirk - therefore, he should get ownership and control of Red?

    Derek's money means it is Derek's club, period. If you, Kirk or anyone else doesn't like the way he runs or acts in his club - then don't go there.

    Comment by J H — March 15, 2008 @ 10:38AM

  16. Milton "Skip" Ohlsen the convicted drug dealer involved in a nightclub that owners and management are alleging drug use and sales are regular activities.

    Curious.

    Perhaps we should investigate.

    Comment by DEA — March 21, 2008 @ 10:45AM

  17. More two cents:

    RED is such a waste of a potential - its pathetic and at this point, nobody is ever going to go there ever again. I will also point out that as soon as either of these "businessmen" start anything else up - they are doomed from the gate. Then again - drug money and/or mob money can buy you anything - including a bunch of wanna be gangsters, pimps and hoes. Pathetic every way you slice it.

    Add: What a sham on the city of St. Louis for giving people like this permits to operate because they get some rev out of it.

    DCB

    Comment by Downtown Charlie Brown — March 24, 2008 @ 01:34PM

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