"He used to eat at the restaurant only with Julie."
Translation:Il ne mangeait au restaurant qu'avec Julie.
You can't win with this question. The first time my answer was marked wrong and the correct answer was "Il ne mangeait qu'au restaurant avec Julie". When this question came up again at the end of the same exercise, I put down the "correct" answer but it was marked wrong. Surprise, surprise, the correct answer was " Il ne mangeait au restaurant qu'avec Julie", which I had in the first place!! It's so frustrating! Grrrr...
Que (after ne) goes before what's being restricted. Qu'au resto means only at the restaurant, not at home or in the park. Qu'avec elle means only with her.
I'm not a native speaker but JoJo (above) is. My French teacher (a native speaker) drilled us on this some, too. It's actually much more straightforward than in English, where "only" can be placed in several places, some of which make the meaning ambiguous.