CHARLESTON, S.C. (WCSC) - The franchisee operating 24 Burger King restaurants in South Carolina is scheduled to appear in a federal bankruptcy court Monday to learn whether it can close seven of its locations.
A federal bankruptcy judge granted Capital Restaurant Group an emergency hearing set for Friday morning in Atlanta to determine whether it will reject lease and franchise agreements for the restaurants in question, according to a court order filed Tuesday.
CRG owns and operates 24 Burger King restaurants in South Carolina, several of which are “underperforming and negatively affecting” its cash flow, according to court documents.
The Capital Restaurant Group said it intended to cease operations at these seven locations no later than Wednesday:
- 3917 Rivers Ave., North Charleston
- 1812 Sam Rittenberg Blvd., Charleston
- 5125 Ashley Phosphate Rd., North Charleston
- 3579 Savannah Hwy., Johns Island
- 955 Bacon’s Bridge Rd., Summerville
- 4820 Tanger Outlet, North Charleston
- 293 Britain St., Santee
In court documents, Capital Restaurant Group claims it offered to transfer the locations to BK Corporation, the parent company of Burger King or its designated operator and repeatedly requested permission to close the locations.
“BK Corporation has refused, instead forcing [CRG] to continue operating the underperforming restaurants at a loss – while continuing to pay rent and royalties to BK Corporation – under threat of legal action that would surely follow any closures,” the documents state.
The group also claims that BK Corporation “tentatively agreed” to allow the underperforming restaurants to close in conjunction with the sale of the other restaurants, BK Corporation “employed tactics that have delayed the possibility of one or more potential sales.”
The group employs nearly 500 people in the 24 restaurants, court documents state.
Late Wednesday, BK Corporation responded to a request for comment, stating it “does not comment on ongoing litigation, including bankruptcy.”