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January 26.2026
3 Minutes Read

Fat Brands Faces Lawsuit Over Twin Peaks Shares: What Restaurant Owners Should Know

Twin Peaks restaurant sign under blue sky, Fat Brands lawsuit context.

Understanding the Legal Turmoil Facing Fat Brands

Fat Brands, the parent company of numerous well-known dining chains, is currently embroiled in a significant legal battle. The company is facing a lawsuit from 352 Capital, its largest bondholder, over allegations of not delivering promised shares of its popular restaurant chain, Twin Peaks, as collateral for unpaid debts. This lawsuit highlights the financial distress that has been plaguing Fat Brands for some time, a situation that has become increasingly precarious as the company tries to dodge bankruptcy while attempting to restructure its staggering debt of approximately $1.4 billion.

What Led to This Dispute?

At the heart of the legal complaint is the alleged failure of Fat Brands to deliver Class B shares of Twin Peaks to UMB Bank, the trustee managing its whole business securitization financing. The Class B shares in question represent a critical control mechanism, as each share comes with 50 voting rights, providing substantial influence over the company compared to the one vote attached to each Class A share. As of now, Fat Brands holds around 95% of Twin Peaks shares, a position that it had hoped would shield it from creditors. This strategy, however, appears to be backfiring in light of defaults on loan payments.

The Bigger Picture: Financial Struggles in the Restaurant Sector

Fat Brands' troubles are indicative of broader challenges within the restaurant industry, which has struggled with declining same-store sales across many chains over the past few years. This market downturn has contributed to a liquidity crisis for Fat Brands, as seen through its missed payments and ongoing liquidity issues. Franchise owners and restaurants alike are feeling the strain amidst tightening profit margins and changing consumer behaviors. Moreover, legal questions regarding operational control complicate matters further for Franchises relying on support from major corporations like Fat Brands.

The Implications for Restaurant Owners

For restaurant owners and prospective investors, the unfolding situation at Fat Brands serves as a cautionary tale. The consequences of financial mismanagement can reverberate throughout the industry, potentially affecting supply chains, franchisee relationships, and consumer confidence. Owners need to remain vigilant, focusing on solid financial practices while staying informed about larger economic conditions that can impact profitability.

Financial Recommendations Going Forward

In light of the challenges faced by Fat Brands, the following strategies could help restaurant operators safeguard their businesses:

  • Diversify Revenue Streams: Explore catering, delivery, and takeout options to mitigate the risk of relying solely on dine-in customers.
  • Cost Management: Closely monitor expenses and negotiate better rates with suppliers to enhance profitability.
  • Stay Informed: Attend industry conferences and networking events to stay abreast of market trends and legal developments that might impact restaurant operations.
  • Leverage Technology: Implement modern solutions for order management, customer engagement, and delivery logistics to maintain competitive advantage.
  • Set Aside Emergency Funds: Maintain a reserve to buffer against unexpected downturns, similar to those now facing Fat Brands.

Conclusion

The legal wrangling surrounding Fat Brands reveals the harsh realities that can quickly arise in the restaurant business. For owners, recognizing the signs of financial strain and proactively addressing challenges can make all the difference. As the situation evolves, staying informed and adaptable could provide a lifeline amid the tumultuous landscape of the restaurant industry.

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02.21.2026

Supreme Court's Ruling Strikes Down Trump's Tariffs: What It Means for Restaurant Owners

Update The Supreme Court's Landmark Decision: Implications for Restaurant OwnersOn February 20, 2026, the Supreme Court's ruling against President Trump's tariffs has triggered significant waves across various sectors, particularly within the restaurant industry. The decision, reached with a 6-3 majority, holds that the president exceeded his authority when he imposed sweeping tariffs through the International Emergency Economic Powers Act (IEEPA), a statute meant for emergencies. For many restaurant owners who have borne the economic burden of these tariffs, this ruling offers a glimmer of hope amidst an often volatile landscape.The Impact on Pricing and Costs in the Restaurant SectorFor restaurant owners, the implications of this ruling cannot be understated. Trump's tariffs affected a wide range of products, ranging from ingredients to equipment, leading to increased prices for consumers and squeezed profit margins for businesses. With the potential for refunds on tariffs already paid, restaurateurs may find some financial relief, aiding their recovery from the heavy costs associated with these duties.Understanding the Ruling's Wider Economic ContextThe Supreme Court's ruling is not just a setback for Trump’s administration but signals a pivotal point for how future tariffs might be implemented. Chief Justice John Roberts emphasized that the IEEPA does not authorize the imposition of tariffs, stressing the need for congressional approval for such decisive economic measures. This aspect is crucial, as the restaurant industry often relies on imported goods, and stability in pricing can support better budgeting and forecasting for restaurant owners.Future Strategies in Trade and TariffsWhile the Supreme Court ruling curtails the use of IEEPA for tariffs, it does not eliminate all avenues available for imposing tariffs. Other legislative tools remain available under laws like the Trade Act of 1974. Restaurant owners should brace for potential changes in import costs through these alternative measures, and they must stay informed about evolving trade policies that could impact their bottom line.Voice of the Industry: Support and ReliefFeedback from within the industry has been overwhelmingly positive regarding this ruling. Victor Schwartz, a New York-based importer, referred to the tariffs as “arbitrary, unpredictable, and bad business.” Many restaurant owners have echoed his sentiments, advocating for a full refund process that must be efficient and clear, ensuring that businesses are not held hostage by bureaucratic delays.Next Steps for Restaurant OwnersIn the wake of this ruling, restaurant owners should take proactive steps in addressing potential tariff refunds and keeping an eye on future tariff structures. Consulting with trade experts or legal advisors may provide invaluable insights on navigating refund requests and adjusting supply chains accordingly. Understanding these nuances could enhance financial resilience and operational efficiency moving forward.As the dust settles from this Supreme Court decision, the restaurant community stands at a crossroads. Adapting to the aftermath of tariff impacts will require both strategy and support from policy makers, while maintaining an open dialogue with wholesalers and suppliers will help insulate businesses from further economic shocks.

02.21.2026

Subway Ends Free Sub Offer: What Restaurant Owners Should Know

Update Subway's Free Sub Offer: The End of a Popular IncentiveSubway, a staple in the fast-food landscape, has recently made headlines by pulling back on its beloved free sub incentive. After a brief revival of its Sub Club rewards program, which promised customers a free footlong after a series of qualifying purchases, the company announced that customers will no longer be able to earn this perk starting April 1, 2026. In a move that has caused significant backlash among customers, the sandwich giant is shifting to a point-based system, a decision influenced by franchisee concerns over diminishing profit margins.Understanding the Sub Club TransformationOriginally reintroduced in December 2025, the Sub Club was designed to attract diners back to Subway, after many had drifted to competitors. The program had offered a straightforward deal: buy three footlongs or six six-inch sandwiches, and earn a free footlong. However, only two months later, Subway is facing mutiny from franchisees, leading to the discontinuation of this advantageous offer. Franchisees, representing a significant portion of Subway’s locations, felt the original rewards were too generous, threatening their profitability. The changes to the Sub Club are a direct response to these concerns amid an environment where competition for customer loyalty is fierce.The Franchisee Factor: Challenges from WithinFranchisee sentiment is crucial for any franchise-based business, and in this case, it’s clear that Subway's management is heeding these voices. A petition was signed by thousands of franchisees urging the company to reassess the Sub Club's previous generosity. The negative feedback echoes through social media where customers have openly criticized the new direction. The main outcry centers on rising prices of subs alongside a perceived dip in quality.Customer Backlash: A Hard Blow to Brand LoyaltyThe online chatter surrounding Subway’s decision reflects a larger trend in customer dissatisfaction. With mounting complaints that the prices no longer match the quality of the food, many customers are questioning their loyalty to the brand. The Sub Club's removal of the free sub offer has led to frustration among regular diners who may now see making a sandwich at home as a more appealing option. The notion of "why pay more for less" resonates deeply with consumers, potentially steering them away from Subway in favor of more competitive and rewarding offers from other fast-food chains.Looking Ahead: Future of Subway’s Loyalty ProgramThis recent shift away from the free sub towards a point accumulation system may signify a pivot towards navigating the complexities of modern consumer expectations and market dynamics. The planned point system will reward customers with points per dollar spent, essentially offering smaller-than-expected savings that many original Sub Club patrons find unimpressive. Starting with 400 points yielding $2 in Subway Cash, it raises questions about how effectively this new model will stimulate repeat visits.Conclusion: What Does This Mean for Restaurant Owners?For restaurant owners, especially within the franchise model, the situation at Subway highlights the delicate balance between customer loyalty and franchise expectations. As customer preferences evolve, adapting loyalty programs becomes crucial—what work for one franchise may not work for another. Subway's experience serves as a reminder that customer engagement, derived from effective reward programs, can significantly impact a brand's perception and profitability.As the landscape of fast-food chains continues to evolve, staying attuned to customer desires and franchisee feedback is essential in redefining what value truly means in today's competitive marketplace.

02.21.2026

Peach Cobbler Factory's Expansion in Georgia: A Game Changer in Dessert Franchising

Update Why Peach Cobbler Factory is Setting New Standards in Dessert Franchising The Peach Cobbler Factory, a celebrated dessert franchise founded in Nashville in 2013, is expanding rapidly, marking its influence on the dessert landscape. With a new location recently inaugurated in Stone Mountain, Georgia, the franchise exemplifies how a well-executed expansion strategy can lead to category leadership in the dessert market. The Peach Cobbler Factory has become a beacon of dessert innovation, showcasing a menu that includes not only traditional favorites but also unique offerings such as churro sticks and cobbler shakes. The Significance of Georgia as a Growth Market Georgia, often referred to as the Peach State, is crucial for the franchise's expansion strategy. Plans are already underway for up to 20 locations throughout the state, which emphasizes the brand’s commitment to creating a deep market presence. Greg George, Co-Owner of PCF Franchise LLC, notes that "our brand has been well received in Georgia." This strong consumer demand contrasts with many other food franchises that struggle to establish a foothold in competitive markets. Multi-Channel Expansion: Beyond Brick-and-Mortar In addition to traditional storefronts, Peach Cobbler Factory is diversifying its reach through mobile dessert trailers and catering programs. This multi-channel approach allows the brand to cater to a variety of occasions, from family celebrations to large corporate events. According to recent developments, catering has emerged as a promising growth area, allowing the factory to tap into venues such as airports and stadiums. Understanding Peach Cobbler Factory's Menu Appeal The menu at Peach Cobbler Factory is carefully curated to appeal to a broad audience. Signature items like warm fruit cobblers and banana puddings not only evoke nostalgia but are also prepared to high standards that ensure quality. Catering to families and local communities, the brand has created an inviting atmosphere that pairs well with their comfort-focused desserts. This focus on quality has been a cornerstone of their brand identity and serves as an appealing factor for potential franchisees. The Operational Strength Behind the Growth One component of the Peach Cobbler Factory's growth stems from a solid foundation in operational strength. With an effective franchise model in place, new franchisees are equipped with the tools necessary to succeed. This model, fortified by the experience of co-owner Larry Johnston, has allowed the company to scale efficiently, supporting franchise partners who are as invested in long-term brand building as the company itself. Future Predictions: What’s Next for Dessert Franchise Expansion? As Peach Cobbler Factory continues to dominate the dessert franchise market, industry experts predict that its innovative approach could inspire other brands to diversify their offerings. This trend may pave the way for increased competition in niche dessert markets and could lead to a larger movement towards franchising unique culinary experiences rather than traditional fare. The dessert landscape is poised for significant changes as consumer preferences evolve, and brands like Peach Cobbler Factory will likely lead the way in reimagining what dessert shops can offer.

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