Chicken chain denied Chapter 11 bankruptcy filing as debts pile up

A judge denied the second bankruptcy filing by the owner of rotisserie chicken chain Boston Market, leaving it on shaky financial ground.

Boston Market owner Jay Pandya filed for Chapter 11 bankruptcy last month after another judge ruled that he and Boston Market owe U.S. Foods BB #:134354 $15 million (including interest and attorney fees) due to unpaid bills.

According to Restaurant Business, the chain has been reduced to 27 stores nationwide. Boston Market had about 300 locations at the start of 2023.

Restaurant Business also reported that the chain has had many wage and hour violations and has been sued more than 150 times, mostly due to unpaid bills.

In denying the bankruptcy claim, the judge also banned Pandya from filing another one for six months, which will prevent Boston Market from being able to reorganize its finances.

The judge who ruled in favor of U.S. Foods, Manish Shah, a federal judge in the U.S. District Court for the Northern District of Illinois, rejected Boston Market’s claims it was overcharged, and said the company must fulfill its obligations under the purchasing trust, the Perishable Agricultural Commodities Act (PACA).

“There is no dispute that US Foods delivered goods subject to a PACA trust, Boston Market didn’t pay, and [owner Jay] Pandya was an officer with sufficient authority to subject him to PACA liability,” Shah wrote in the ruling.

In January, the chain launched an owner-operator program called Boston Market Connect, which offered ideas for untraditional growth, such as targeting delis and gas stations, and introducing new items, such as chicken tikka and biryani, which would rotate every six weeks.

According to Restaurant Dive, it found no restaurant locations offering those dishes or that had any plans for the rotating menu idea.

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