Another fast-food franchise owner has filed for Chapter 11 bankruptcy. Will the burger joint close any restaurants?

It’s a tough time to own fast-food restaurants. 

Franchisees for popular chains such as Applebee’s, Subway, and Popeyes Louisiana Kitchen have filed for bankruptcy recently, and another has joined them.

Multiple entities associated with Friendly Franchisees Corporation (FFC), owner of 65 Carl’s Jr. locations across California, have filed for Chapter 11 bankruptcy, Restaurant Business first reported.

Carl’s Jr. was founded almost 85 years ago and is known for its charbroiled burgers.

FFC has yet to state whether any Carl’s Jr. locations will close as a result of the bankruptcies.

Its founder, Harshad Dharod, owns the five associated entities that filed for bankruptcy in U.S. District Court for the Central District of California, including Sun Gir, DFG Restaurants, and Second Star Holdings.

Fast Company has reached out to FFC and Harshad Dharod for comment and will update this post if we hear back.

In each case, the entities have assets and liabilities worth less than $50,000.

Will Carl’s Jr. locations close?

While franchises aren’t owned by the brand, related bankruptcies could reflect poorly on the chain.

Carl’s Jr. seems intent on placing the blame elsewhere. 

“We are aware that Carl’s Jr. franchisee Harshad Dharod entities and its affiliates, which together independently own and operate certain Carl’s Jr. restaurants in California, have entered into a court-supervised restructuring process under Chapter 11 of the United States bankruptcy code,” a company representative told Fast Company. “This situation is specific to this individual’s financial and business circumstances.”

The statement from Carl’s Jr. continued: “This has no impact on the operations of any other Carl’s Jr. locations and we remain committed to delivering quality experiences for our guests, while driving profitable, sustainable growth for our franchisees and the brand.”

Carl’s Jr. is owned by Tennessee-based CKE Restaurants Holdings, which also owns Hardee’s.

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