Stuffy's owners want to reopen, but lawsuit says fraud, forgery by staff blocking them

As the founders of Longview's Stuffy's II diner prepare to appeal their $936,000 in COVID-era fines with the state's highest court, another six-figure court battle is threatening the restaurant's prospects of reopening.

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At a hearing scheduled for 9 a.m. Thursday, the Washington State Supreme Court will consider the constitutionality of the Department of Labor & Industries' 52 separate $18,000 fines imposed against the 1950s diner at 805 Ocean Beach Hwy. in 2021 and 2022 for refusing to comply with then-governor Jay Inslee's shutdown orders intended to mitigate the spread of the coronavirus in late 2021 and early 2022.

Separately, founders Glenda and Grant "Bud" Duling filed a civil suit in Cowlitz County Superior Court last month accusing their granddaughter, Skai Hogue, of breaching her fiduciary duty while managing the business and handling many day-to-day affairs since 2021 and through the Aug. 4 fire that closed the diner.

Prior to the pandemic, Stuffy's II was best known for being featured on a Food Network program in 2011.

The lawsuit filed April 16 makes a series of claims that Hogue took control of the Dulings' restaurant and self-storage businesses "through overreaching, manipulation of information and deceit." It claims that Hogue, who grew up in the restaurant and at one point was given power of attorney over her grandparents upon their capacity, had "conspired to exploit" the Dulings "by converting company funds and paying herself and the closely related defendants most of the insurance proceeds from the fire."

The Dulings' lawyer in the civil case, Michael Frey of Longview, did not respond to an emailed request for comment by deadline.

Skai and Zane Hogue's lawyer retained in the civil case, Jackson Maynard of Olympia, said that his clients "strongly disagree with the unfounded and baseless accusations in the lawsuit and look forward to defending against them in a court of law."

State Supreme Court hearing

The restaurant's refusal to abide by the state's pandemic restrictions on indoor dining around 2021 into early 2022 ultimately cost the business $936,000 in fines. On Thursday, the Washington state Supreme Court will determine whether those fines violate the U.S. Constitution's Eighth Amendment, which bars the state from imposing excessive fines and fees.

The restaurant's defiance prompted "Stand with Stuffy's" demonstrations and garnered headlines around the state. L&I, however, deemed each of the 52 days the restaurant opened during pandemic shutdowns to be a "willful serious violation" costing $18,000.

Lower courts upheld the fines, with Cowlitz County Superior Court affirming them in late 2023 and the Washington State Court of Appeals upholding the ruling roughly a week after the fire in August 2025.

Those rulings pushed the family business to appeal to the state Supreme Court. The Duling Enterprises case is the only one on the Supreme Court's docket for 9 a.m. Thursday, May 14.

The hearing will be broadcast online at tvw.org/video/washington-state-supreme-court-2026051036.

Paying Zane Hogue's business, claims of forgery

The Dulings' civil lawsuit, among other claims, accuses Skai Hogue of using insurance money to benefit her husband's business and of forgery.

It claims that on Nov. 21, Stuffy's holding company Duling Enterprises tendered an $868,693.92 check to Imperial Construction with a note stating the money was "for building recon deposit."

The amount came one week after a check from Farmer's Insurance worth $885,145.60 was deposited for the Aug. 4 fire.

The fire's cause is undetermined. The lawsuit states that the restaurant caught fire and burned down "for unknown reasons."

Earlier news reports said flames were first seen in the mechanical room where the washer and dryer were located, and that authorities had ruled out foul play.

The Dulings' lawsuit claims the check to Imperial Construction was endorsed using Glenda Duling's signature stamp without Glenda's knowledge or permission, and that the note had Skai Hogue's handwriting. The Dulings claim they learned Imperial Construction was a company owned by Skai Hogue's husband, Zane Hogue, through a Washington State Labor & Industries contractor database.

Stuffy's

A sign outlining temporary closure hangs on a door to Stuffy's II on Tuesday, May 12, in Longview. Cowlitz County Superior Court records show the owners aim to reopen after an August fire, but are stalled. A lawsuit says they suspect the restaurant's former manager, who is also their granddaughter, of using insurance money to pay her husband's business for repairs without the owners' knowledge.

In a personal statement filed with the suit on April 16, Glenda Duling claimed that she and her husband had discussed rebuilding plans with Skai and Zane Hogue after the fire, but "at no time did we give up our rights to decide for ourselves."

"We did not agree to hire Zane or his company, Imperial Construction, to act as our general contractor," Glenda Duling wrote in her declaration statement.

Based on the work of an accountant hired by the Dulings, Farmer's Insurance paid out an estimated $1,378,824.53 "by one report and possibly more," but the couple says they never saw the money.

Glenda Duling claimed in her statement that she has every intention of reopening, and described wanting to use the insurance money to keep the restaurant's staff on the payroll for cleanup. She concluded, however, in her sworn statement that her business may not survive without their insurance proceeds.

"Her (Skai Hogue's) behavior is alarming and may push us into seeking bankruptcy protection unless we can get our proceeds back as soon as possible," Glenda Duling wrote in the April 16 court document.

Accountant discovers discrepancies

Glenda Duling claimed in her declaration that frustrations grew in the aftermath of the fire, between August and November.

"We kept asking Skai about our business and she kept telling us she was doing the payroll and she had her husband, Zane, working with the Farmer's Insurance representatives to obtain the proceeds from the loss," Glenda Duling wrote. "Skai and Zane told us it was delayed; and that they were taking care of everything."

Glenda Duling claims that the last money they received from her granddaughter was on Dec. 15, while she and her husband were eating at the Wendy's in Longview.

Hogue arrived at the restaurant with Dennis McCarthy Jr., Glenda Duling's son and Skai Hogue's father, and handed them $10,000 in cash.

"She told us that we needed it to pay the employees," Glenda Duling wrote. "We did not understand what was going on, but we took it to pay our employees."

The following month, Glenda Duling wrote, "We gave up hoping Skai and Zane Hogue would help us survive."

Stuffy's

A damaged door is seen at Stuffy's II on Tuesday, May 12, in Longview. The dinner has been closed since an Aug. 4 fire.

The accountant they hired discovered, among other claims, that Skai Hogue "appeared to have filed nothing and paid nothing" with the Internal Revenue Service for the third and fourth quarters of 2024, "leaving a big tax debt and penalties."

It goes on to describe issues with payroll.

Glenda Duling wrote that based on her experience with bookkeeping, "it appears to me that Skai reported fake employee payments for labor even after employees quit working." She also describes credit cards set up in the name of Duling Enterprises "that had been used and not paid."

"I believe from summer through December 2025, Skai paid herself $491,809.01 for payroll, business income loss, property payments, tips, claiming it as part of our employees' payroll in 2025," Glenda Duling stated.

Criminal investigation pending

The lawsuit also seeks a temporary injunction to extend a freeze on the $868,693 payment to Imperial Construction in November, as well as the business' checking and savings accounts at a local credit union until the civil case is resolved.

Longview police were able to freeze the account for 45 days at a time starting Dec. 18 due to what a Longview detective said was an "active investigation relating to theft of funds," according to court records.

As of Wednesday, Cowlitz Superior Court records show that the Hogues have not been charged with any crimes. A declaration on city letterhead from Detective Richard Gibbs does not disclose "specific investigative steps or outstanding investigative measures," citing the active investigation. It does mention that the investigation involves credit union accounts belonging to the Hogues and related business ventures.

Stuffy's

Overgrown weeds and caution tape are seen at Stuffy's II on Tuesday, May 12, in Longview. The dinner has been closed since an Aug. 4 fire.

"These accounts maintained a large sum of money and/or had internal transactions that correlated with other evidence related to my case," Gibbs wrote in his declaration. He added that "additional warrants related to this case" have been successfully served, but "substantial investigative steps" are still ahead.

"It's been and is still my belief that for the immediate future, no action short of freezing the associated accounts will protect the interests of all parties involved," Gibbs concluded.

A hearing regarding the freeze of Imperial Construction's checking and savings accounts as a temporary injunction, among other matters in the case, is currently scheduled for May 20.

More than $500,000 owed to different grandparents

The Dulings have money issues with their granddaughter beyond the restaurant.

The lawsuit also claims the Dulings paid Skai Hogue a $300,000 personal loan from their savings to help her and her husband build a house. With 5% simple interest, $330,000 was due in full on July 25, 2025, according to Glenda Duling's statement, bolstered with a copy of the contract they signed.

Separately, a Cowlitz County Superior Court case filed in December by Zane Hogue's grandparents, Claude Millard, Jr. and Hurmalee Millard, accuses the Hogues of defaulting on a separate $200,000 loan originally due in March 2024.

Stuffy's owners

Stuffy's II Restaurant owners Glenda and Bud Duling speak to a crowd of people at the "Stand with Stuffy's" rally at the Hall of Justice in Kelso in 2021. The owners face fines for staying open during the state's COVID-19 lockdowns.

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This story was originally published May 14, 2026 at 12:41 PM.