Monday was a bad day for Gary L. Reinert Sr.

U.S. Bankruptcy Court Judge M. Bruce McCullough in Pittsburgh signed the order selling Max & Erma's to a Denver-based company, American Blue Ribbon Holdings, officially ending Mr. Reinert's contentious two years of ownership of the restaurant chain.

"It's a sad day for me on that one. I'll never understand how it happened so fast with the bankruptcy," Mr. Reinert, 70, of Baden, said Tuesday during an emotional, two-hour interview in the nondescript Ambridge office of one of the contracting and construction companies he owns.

Mr. Reinert said he wanted to publicly explain his side of how Max & Erma's ended up being taken from him.

"When all you have to do is tell the truth in life, what do you have to worry about?" he said.

And the truth, he said, has been painful.

By his estimate he has lost $25 million in Max & Erma's, which includes the original $10.4 million in cash he paid to buy all of the company's publicly traded stock in 2008, plus additional money he put into the company since then.

Losing that money - some of which he hopes to get back through legal action - hasn't devastated his companies or him, though he is about to ask for payments from at least 35 people and companies to which he has loaned money over the years.

Still he acknowledged that his companies were on less-sure footing than they were before.

"They're not in trouble. But because I dedicated so much time to Max & Erma's, things I should have been paying attention to didn't get my attention here. And a lot of jobs I should have got, we didn't get," he said, pausing as his eyes watered up and his voice choked up, "because I screwed up."

How?

"By buying the restaurants," he said.

Many friends and business associates, including his main bank, Fifth-Third Bank, advised him not to buy Max & Erma's or the Damon's restaurant chain, which is also in bankruptcy. " 'You're doing good in the construction business. Keep doing that,' " he said his bank adviser told him.

Mr. Reinert said that when he bought the restaurant chain he thought it would be a way for some of his family - his son-in-law and a niece - to have a business of their own to run.

He thought there was good value in the chain and that he could run it efficiently, as he has the four other companies he owns, all of them contracting and construction related.

So in April 2008 he bought Max & Erma's and its then-106 restaurants for $10.4 million in cash and the assumption of $31 million in debt.

Ultimately, he said, what put Max & Erma's into bankruptcy was basic: "If the economy hadn't hit me and if PNC doesn't come at me, we'd be OK."

The dominoes that began to fall were all related. He had hoped to pay off the bulk of the debt by selling some of the corporate-owned stores. But when the economy began tanking in the summer of 2008, prospective buyers couldn't get loans.

Then in the fall of 2008, when the economy bottomed out and National City bank - the main lender behind a $23 million loan Max & Erma's had taken out before Mr. Reinert bought the business - was bought by PNC Financial, it got worse.

PNC used money from the Troubled Asset Relief Program to buy National City, and Mr. Reinert believes that led PNC to get rid of National City's bad debt quickly, including the Max & Erma's loan.

From the time he bought Max & Erma's until PNC finally went to court over the loan last year, Mr. Reinert said he paid off about $7 million of the $23 million loan. He said he thought, having demonstrated an ability to pay, he could do what he has done with other lenders over the years and work out a repayment schedule.

"I went to PNC three times and they just kept saying, 'Forget it. It's not going to happen,' " he recalled.

Mr. Reinert said PNC was his main bank for the first 20 years of his business, but, now, he said: "I will never do any more business with PNC."

PNC had no comment on its dealings with Mr. Reinert.

He said he was also still upset at a quote from Mark Roberts, the interim manager of Max & Erma's, that appeared in a Saturday Post-Gazette story. Mr. Roberts said that when he took over the company in January, "It was a mess."

"The part that hurts me the worst is the Mark Roberts has said many, many times, 'Gary, you took care of things here,' " Mr. Reinert said. "It wasn't a mess. The same people were there who had run the company before me. Some of them took pay cuts to stay. The people I kept loved the brand."

Mr. Reinert said that when he first agreed to file for bankruptcy, he thought it was a way to give him time to work out a payment plan with his creditors, but that, "I didn't really understand bankruptcy. That was a learning experience."

He lost control of the company in January after a report from the creditors committee alleged a series of fraud and mismanagement by Mr. Reinert, including allegations that $9.1 million was paid before filing for bankruptcy to G&R Acquisitions, the company that officially bought Max & Erma's in 2008, as repayment for equity contributions, as well as an allegation that he had paid family members $1.3 million from Max & Erma's accounts.

He said he would prove in court that those allegations were untrue, and that any money that supposedly came back to him was put right back into Max & Erma's.

The confusion, he said, is that he was using his other companies, such as Road Runner Planning and Consulting, to pay for outside consultants, and Power Contracting to do maintenance and repairs at corporate-run restaurants.

"When they follow the money, they'll see it all went back to Max & Erma's," he said.

"Money Q&A" and "Company Town" are featured exclusively at PG+, a members-only web site of the Pittsburgh Post-Gazette. Our introduction to PG+ gives you all the details.