"Having spent all of our funds as well as the donated money we were unable to continue the lawsuit. We know that we had a strong winning case but unfortunately we never made it to trial," the restaurant posted on Instagram.
The restaurant has been around since the 1930s. La Golondrina has also served as a venue for weddings and quinceañeras. It shut down during the COVID-19 pandemic.
The restaurant says its lawsuit against the city of Los Angeles over plumbing issues became too costly.
"Unfortunately @mayorofla office was unwilling to recognize this plumbing issue. We know this whole attempt to get us to close has been political from day one. I just wish we had the funds to continue the fight. This time Goliath beat David. We are truly sorry we did everything in our power," the restaurant said. "The whole thing has been very discouraging and eye opening to how the political system works in LA."
Meanwhile, the operator of a donkey stand on Olvera Street is facing eviction after more than 50 years in business.
L.A. Councilman Kevin De Leon said he's trying to prevent La Carreta from closing.