Mike Koozmin/The ExaminerJobs lost: Café Gratitude’s owners will lay off 220 of their 300 employees when they close eight Northern California restaurants.

'Betrayal': Employee lawsuits lead to Cafe Gratitude closures

Many health food enthusiasts will have to look elsewhere for their $13.75 sandwich of almond paté on apple curry bread.

Citing expensive lawsuits from employees, Café Gratitude is shuttering all eight of its Northern California eateries, which are known for their organic vegan fare named for affirmations.

“All these employees are people we love,” said Matthew Engelhart, an owner. “These are people, we participated in their lives, we supported them in lots of different ways. It feels like a betrayal.”

Engelhart and his wife, Terces, built their food business on ideals of sustainability, generosity and community, he said. The first location opened in the Mission district in 2004, and the chain has grown to nine locations, including cafes in Berkeley, Oakland and Cupertino. The company also owns Gracias Madre in the Mission.

The food served includes such items as “I am bright-eyed” — a breakfast concoction of coconut milk, nuts, fruit, vanilla and cinnamon — and “I am warm-hearted” — a helping of grilled polenta with puttanesca sauce, cashew ricotta and Brazil-nut Parmesan. They also offer retreats for community building and soul searching, and have an online store that sells food, T-shirts, greeting cards and board games.

But employees Sarah Stevens and Ravi Shankar weren’t feeling the love from the company.

Stevens, a former server, bartender and line cook for the cafe, filed a lawsuit in August over the restaurant’s tipping system, which pools servers’ tips and gives workers at other locations a cut, according to her lawyer, Stephen A. Sommers.

Sommers is also representing Shankar, who works as a bookkeeper and alleges the business did not pay him overtime. He filed his suit in October.

Engelhart said those claims are false, but the legal costs have pushed him to sell all but two of the restaurants and lay off 220 of their 300 employees. One cafe in Los Angeles will stay open, and a new restaurant in Venice is scheduled to open in the spring.

Engelhart announced the news Tuesday on Café Gratitude’s website and Facebook page, and said the restaurants would close within three to six months, as the company finds buyers.
But Sommers said the amount his clients are seeking — a total of about $200,000 — should not warrant closing eight restaurants.

“They can talk all day long about how they think it’s bogus, but that’s just their hippie mindset talking,” Sommers said. “They know they’re doing something wrong.”

Ravi Belani, a regular at Café Gratitude’s original Mission storefront, said he was shocked to hear there was trouble at his favorite feel-good eatery.

“I love Café Gratitude,” Belani, 35, said on his way out of the cafe. “It’s very difficult to get wholesome, organic food that’s tasty.”

Belani said the staff is always friendly and welcoming, but noted that he barely gets to know one server before someone new has moved in.


Closing time

Locations in Northern California:

  • 2400 Harrison St., San Francisco
  • 2211 Mission St., San Francisco
  • 230 Bay Place (in Whole Foods Market), Oakland
  • 1730 Shattuck Ave., Berkeley
  • 2200 Fourth St., San Rafael
  • 20955 Stevens Creek Blvd. (in Whole Foods Market), Cupertino
  • 206 Healdsburg Ave., Healdsburg
  • 103 Lincoln St., Santa Cruz


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