Utah's iconic La Caille restaurant sells for $10M
Little Cottonwood Canyon • New owner to focus on marketing it as a special-events destination.
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La Caille restaurant has been sold for $10 million, ending a sad saga of lawsuits, criminal charges, bankruptcy and a suicide pact that followed the breakup of the partnership that created the iconic restaurant.

In the end, it was a settlement of the long-running lawsuit over the property that allowed the sale to move forward.

U.S. Bankruptcy Court approved the sale of La Caille last week to Kevin Gates, president of Salt Lake City-based 19 Kamaka LLC. He paid about half of the $19.9 million listing price for the 20-acre property near the mouth of Little Cottonwood Canyon.

Mary Runolfson, daughter of former part-owner Steven Runolfson, said Gates expects to close this month on the individual parcels that comprise the property. She said she is the only family member to accept Gates' offer to continue working at La Caille, as special-events coordinator.

"The new owner has even invited me to live in my current home here on the property," Mary Runolfson said. "I think it's important for the public to know that La Caille will always be La Caille — with a little TLC and a fresh coat of paint — and at least one family member will be part of it."

Gates, a Salt Lake City native who lives in Las Vegas and has interests in a hotel in Hawaii and in a restaurant in San Diego, has said he plans to keep La Caille as a restaurant, but will focus on marketing it as a premier special-events destination. He could not be reached for comment on Monday.

David Johnson and Steven Runolfson opened La Caille in 1975, adding a third partner, Mark Haug, in the 1980s. The restaurant, with its French cuisine, developed a reputation as the epitome of fine dining in Utah. But things began to unravel in the mid-2000s when Haug sued his two partners, alleging breach of contract.

In March 2010, a 3rd District Court jury found that Runolfson and Johnson did breach their partnership agreement with Haug in an attempt to take control of his share. The $4.7 million award included punitive damages after the jury found that Runolfson and Johnson were behind a "malicious prosecution" scheme that resulted in Haug being charged with misappropriating La Caille money. The Salt Lake district attorney later dropped the charges.

The award forced La Caille into Chapter 11 bankruptcy. The property was offered up for sale.

Family members say that Steven Runolfson and his wife, Lisa, were emotionally devastated at losing the restaurant. In December 2010, the couple's bodies were found dead from gunshot wounds at the Provo Marriott hotel. A police investigation concluded their deaths were the result of a murder-suicide pact.

A legal settlement last month halted the family's legal appeal of Haug's lawsuit and allowed the sale to move forward. Haug agreed to cut his award to $2.5 million.

"The settlement was a middle-of-the-night thing to try to get this done," said Mary Runolfson. "Everyone knew if we didn't have a settlement — we didn't have a buyer."

Haug's lawyer, Jim Magleby, said that the settlement is the final vindication of his client's case and his motives.

"He took less than he was entitled to and one reason was that it left everyone with something," Magleby said. Another reason Haug settled, Magleby explained, was that the deal allows La Caille to survive as a restaurant.

"La Caille is a legacy that has some importance to Mark," Magleby said. "We're happy that [Gates] is not coming in with bulldozers. Mark would not be happy to see them knock down the restaurant he helped build with his partners."