Why do the folks running the Merkato 55 Saturday brunch party boast about how much money they are making? Maybe it has something to do with the illegal liquor they are apparently serving! According to a Little Birdy, "Merkato 55 got busted for selling illegal liquor. Meaning they went to jersey and bought liquor." It's well known that booze is cheaper in New Jersey because of the state sales tax, so operators often head across the border to buy in bulk in order to reduce inventory costs. If it's true, Merkato certainly isn't the first to be busted for this crime, and certainly won't be the last. Meanwhile, a second Little Birdy updates us on the news that Megu is circiling the troubled space, saying that "negotiations are still happening."

Breaking news across the Birdy wire! Updating this morning's rumor, Megu has been in discussions with the landlords and leaseholders to take over the troubled Merkato 55/Bijoux space in the Meatpacking district. According to our Little Birdy, "it is an extremely complicated situation", making the deal probable but unlikely. It seems logical that if a deal was reached, Megu would bring its new M Lounge concept to fill the Bijoux space, while the upstairs would function as a dedicated restaurant. It is the MPD, how can they not have a lounge? And if they are negotiations with Megu, the end for the famed Merkato brunch party is certainly near. Sigh. We will continue to post as this story unfolds.

Just when we were wondering if the Meatpacking District was bound to be a culinary wasteland, a commenter drops a huge rumor* that sent our heads a spinning. According to said commenter, "Word has it that Megu is in negotiations with Merkato." Crazy. Megu is a fine establishment with a global reputation for luxurious Japanese cuisine served by an expert staff, and we would have to think plunking itself in the heart of the MPD action would be a successful venture, giving tourists and corporate types one more option to go big in the hood. But is it an original dining concept that is choosing the Far West Side to make a go of it? Hardly. It's two NYC locations already do a brisk business. This is akin to Nobu opening on 57th Street - a big concept with a huge up front cost, but with little risk, unless customer's appetite for Japanese cuisine wanes. Fat chance. We will wait to see how this plays out.

*Again, this is only a rumor. We welcome additional information.