Citizen Apostolou

Losing his grasp of the beloved Chicago-based Giordano’s pizza chain he’d built over decades, a desperate John Apostolou tried to hand over control of the restaurants to an Arizona man who claimed a secret weapon.

Marshall Home, an activist who hails from the darker reaches of anti-government sentiment, promised 65-year-old Apostolou and his family that he could save the business from a bankruptcy court-ordered takeover. Home began preparing his attack–a strategy deemed by some as “paper terrorism”–by drafting motions that contain far-fetched arguments aimed at derailing the case.

Home speaks the language of the “sovereign citizen” movement, a loose group whose followers believe that even though they physically reside in the U.S., they are separate, or “sovereign,” from this country. The anti-government ideology has lurked around the political fringes for decades, attracting adherents from Montana militiamen to Wesley Snipes. Home pushes a variant of the “redemption scheme,” a nonsensical theory that advocates the filing of huge claims against the government entities to recover money it holds in every citizen’s name, to halt home foreclosures.

The filings, Home promised Apostolou, would give Home enough standing in the company to overthrow the most powerful claim in Giordano’s Chapter 11 bankruptcy case: a roughly $45 million loan from Fifth Third Bank.

But the move backfired. Apostolou has lost control of the chain to a court-appointed trustee and has been banned from its headquarters and restaurants. And the trustee, Chicago lawyer Philip Martino, is trying to block Home’s move just weeks after an Arizona bankruptcy judge dismissed another one of his seemingly outrageous legal efforts: an involuntary bankruptcy case he filed against the U.S. government under the name U.S. Corp.

In the meantime, Apostolou worries about the fate of his restaurants and their famous deep-dish slices, sold under the proud banner “Chicago’s World Famous Stuffed Pizza.” He admits not knowing whether Home’s legal tactics will work or if he even believes in the string of strange rhetoric that he and his wife, Eva, signed as the chain’s owners.

His worst fear is that the bankruptcy process will break apart the Giordano’s chain, which includes 35 franchise locations that employ several thousand workers.

“This is destroying an American business,” Apostolou said Thursday. “The company’s in limbo. They have no direction…I have 2,400 employees and no one cares. Not the government, not the judge.”

Apostolou and his wife bought the company in 1988, 25 years after he emigrated from Greece. His first job here was as a bus boy in the former Bismarck Hotel, another downtown Chicago landmark, before joining Giordano’s as a line cook.

Apostolou gradually grew the chain’s franchise network and expanded outside Illinois for the first time in 2005, opening six restaurants in Florida. Giordano’s itself operates six company-owned locations and four joint-venture locations.

But Apostolou used Giordano’s assets to secure a loan he took out to invest in a Florida real-estate development near Walt Disney World. When he missed a payment in January, Fifth Third Bank wouldn’t negotiate and threatened to foreclose, he said. Attorneys for the bank declined to comment.

On Feb. 16, Apostolou signed the bankruptcy petition for Giordano’s Enterprises Inc.

He hired an outside restructuring adviser to file the necessary financial reports and to pay court fees, but both duties went unfulfilled. Amid the confusion, the court put Martino in charge, effectively firing the Apostolous. A subsequent court order banned them from setting foot inside the chain’s corporate offices and its restaurants. That’s when a frantic Apostolou found Home.

Home gave him a two-page emergency motion to file the day before the trustee’s appointment, declaring that the Apostolous had the power to terminate the case because the U.S. had committed bank fraud, securities fraud and tax fraud.

“He’s not knowledgeable financially, but he makes a wonderful pizza,” Home said of Apostolou.

Home and his wife, Mary, align themselves with the Independent Rights Party. They argue against the validity of the U.S. banking system to help struggling homeowners fight foreclosure. Giordano’s marks their first attempt to save a small business.

“The whole system is fraud. There is no money. There are no judges and there are no courts,” said Home, who claims to have taken back his identity from the government and puts a trademark symbol next to his entirely capitalized name. “Everything’s been stolen from the people.

U.S. Bankruptcy Judge Eileen W. Hollowell on May 18 threw out Home’s forced bankruptcy case against the U.S., which she said was an attempt to manipulate the court and “stop various collection actions including foreclosures, forcible entry and detainer actions, and tax garnishments.”

Home accomplished little in that effort, but Martino, the Giordano’s trustee, has warned that his moves in the pizza chain’s Chapter 11 case corrupt the entire claims-filing system and have confused possible buyers.

“Home’s actions should not be dismissed as the harmless antics of an impotent crank,” Martino said in court documents. “They are potentially much more dangerous to [Giordano’s] than his scores of pointless filings in the Arizona Bankruptcy Court.”

Home recently filed papers stating that he has a $200 million secured interest in all of Giordano’s debt that should be paid out before other creditors. Martino says the claim is bogus.

Apostolou admits to taking on the new beliefs “article by article, page by page” but still has a hard time reciting the logic behind them.

“I think I’m a victim of the banking system with the way they loaned the money because they take your signature, they go to the Federal Reserve and take the money and they don’t sign anything–it’s not on their books,” he explained. “At least, that’s what they told me.”

A number of investors have contacted Martino eager to buy the chain, which is profitable in spite of the bankruptcy, lessening chances that the Apostolou family will ever regain ownership.

“If he’s the highest bidder at the sale, I will happily turn the keys back to him,” Martino said.