TGI Friday’s franchisees worried over $50M in gift cards amid bankruptcy
TGI Friday’s recently filed for bankruptcy, blaming the COVID-19 pandemic, its capital structure and a decrease in demand for casual dining for its current status. While the Chapter 11 filing affects only the 39 company-owned restaurants in the U.S., the chain’s franchisees are now worried the bankruptcy proceedings will impact them in the form of nearly $50 million worth of gift cards that are still out there waiting to be used.
Jason Binford, an attorney representing more than 60 franchise locations, argued in a Dallas court hearing Monday, Nov. 4, those restaurants could be on the hook for the millions of dollars in unused gift cards, with some dating back more than 20 years.
“Any comment on this other than — ‘Wow,’” U.S. Bankruptcy Judge Stacey Jernigan said. “$49.7 million on outstanding gift cards. I did a double-take on that. I was imagining, you know, grandparents who got gift cards for their kids in college and then it got thrown away. If it’s going back to 21 years, we have a lot of thrown-away gift cards.”
Usually, the company would reimburse the franchisees for customers using gift cards, but that policy’s feasibility is being questioned amid the 59-year-old restaurant chain’s bankruptcy filing.
The $49.7 million in outstanding gift cards surpasses the $5.9 million the restaurant is borrowing for bankruptcy restructuring, according to court documents.
Binford said the company’s bankruptcy could lead to an uptick in gift card use. He also said a “use it or lose it” mindset for cardholders may make them rush out to spend them.
“We’re certainly supportive of the continued use of gift cards because we agree they drive sales,” Binford told the judge. “It’s just there’s a circumstance where we can be seen, the franchisees, by we I mean, could be seen left holding the bag if there is not a source of funds available to reimburse the franchisees under the ordinary course.”
The judge is allowing TGI Friday’s to continue the gift card program on an interim basis. This gives franchisees more time to review the program and Friday’s finances. Friday’s has 122 franchised locations in the U.S. and 316 more around the world.
Attorneys for TGI Friday’s present at the hearing said the company does plan to honor its obligations for both its franchisees and customers.
Harris, Trump speak on importance of election with 13 days to go
With less than two weeks until Election Day, Vice President Kamala Harris got some help on the campaign trail from a former president and a famous rapper, while former President Donald Trump targeted a certain voting block. And one of McDonald’s famous burgers has been linked to a deadly E. coli outbreak. These stories and more highlight your Unbiased Updates for Wednesday, Oct. 23, 2024.
Harris, Trump speak on importance of election with 13 days to go
With less than two weeks to go until the next U.S. president is chosen, both candidates are highlighting the importance of this year’s election as they make their final pushes to sway undecided voters on the campaign trail.
During an interview with NBC News on Tuesday, Oct. 22, Vice President Kamala Harris once again addressed how her presidency would be different than that of President Joe Biden.
“Let me be very clear, mine will not be a continuation of the Biden administration,” she said. “I bring my own experiences, my own ideas to it, and it has informed a number of my areas of focus, most of which are on to your point, lowering costs. The voters know it, I know it.”
During the interview, Harris was asked about why she is reluctant to talk about the historic nature of her candidacy. If she were to win, she would become the first female U.S. president.
“Well, I’m clearly a woman, I don’t need to point that out to anyone. The point that most people really care about is, can you do the job, and do you have a plan to actually focus on them?” she said. “My challenge is the challenge of making sure I can talk with and listen to as many voters as possible and earn their vote. And I will never assume that anyone in our country should elect a leader based on their gender or their race. Instead, that that leader needs to earn the vote based on substance and what they will do to address challenges.”
In Detroit, a rally was held in support of the vice president featuring rapper Eminem and former President Barack Obama.
“I also think that people shouldn’t be afraid to express their opinions, and I don’t think anyone wants an America where people are worried about retribution, or what people will do if you make your opinion known,” Eminem told rallygoers. “I think Vice President Harris supports a future for this country where these freedoms and many others will be protected and upheld.”
“We’re not going to play games because we’re going to lose our country, our country is failing,” Trump said. “We don’t know what we’re doing. We’re laughed at all over the world. [Chinese] President Xi [Xinping] thinks we’re stupid. [Russian President Vladimir] Putin thinks we’re stupid. That would have never happened if I were president. Putin would have never ever got into Ukraine.”
Then the former president returned to North Carolina for a rally where he criticized the vice president for not having any campaign events so close to Election Day.
THANK YOU, NORTH CAROLINA! This election is a choice between whether we will have four more years of incompetence, failure, and disaster—or whether we will begin the FOUR GREATEST YEARS in the HISTORY OF OUR COUNTRY! pic.twitter.com/JJhJsJcOHk
“You know what she did?” he said. “She took a day off. How do you take a day off 14 days — you don’t take days off, right? I’ve gone 52 days, now, I got 14 more. We don’t take days off we got to win this thing if we don’t win it our country is in big trouble.”
Next up on the campaign trail, Vice President Harris will visit Pennsylvania Wednesday and then on Thursday, Oct. 24, hold a rally in Atlanta alongside Bruce Springsteen. Former President Trump will visit Georgia Wednesday and will record an interview on Joe Rogan’s podcast on Friday, Oct. 25.
The Georgia Supreme Court said it will not step in to reinstate Republican-backed new election rules ahead of Election Day. Seven of the rules, put in place by the State Election Board after the 2020 election, were declared “illegal, unconstitutional, and void,” by a lower-level judge last week.
On Tuesday, Georgia’s supreme court rejected the Republican-led effort to put the rules, which include one requiring ballots be hand-counted and two related to certifying results, back in place and declined to consider an expedited appeal.
Israel says it killed man next in line to lead Hezbollah
Israel said it has killed the man who was next in line to take over as the leader of the militant group Hezbollah. Israeli officials say an air strike in Beiruit, Lebanon killed Hashem Safieddine a few weeks ago, along with other commanders of the Iran-backed militant group.
Hezbollah has not confirmed Israel’s claim that Safeiddine is dead.
🔴 Hashem Safieddine, Head of the Hezbollah Executive Council and Ali Hussein Hazima, Commander of Hezbollah’s Intelligence Headquarters, were eliminated during a strike on Hezbollah’s main intelligence HQ in Dahieh approx. 3 weeks ago.
This comes as U.S. Secretary of State Antony Blinken is in the Middle East looking to broker a cease-fire deal between Israel and Hamas in the wake of the the killing of Hamas leader Yahya Sinwar and bring more humanitarian aid to Gaza.
On Tuesday, Oct. 22, Israeli leaders told Blinken it’s not Israel’s policy to isolate northern Gaza, despite recent United Nations claims that Israeli authorities have denied efforts to bring more aid to the area, according to an NBC News report.
In a letter this month, Blinken and Defense Secretary Lloyd Austin gave Israel 30 days to increase basic humanitarian aid to Gaza or risk restrictions on U.S. military assistance, as required under U.S. law. Israeli officials said they have taken actions in response to the letter, and while Blinken acknowledged progress has been made, he said it is not sufficient.
McDonald’s Quarter Pounders linked to multi-state E. coli outbreak
The CDC has issued a safety alert over a McDonald’s staple: the fast-food chain’s iconic Quarter Pounder. Health officials say McDonald’s Quarter Pounders have been linked to E. coli outbreaks in at least ten states.
E. COLI OUTBREAK: CDC is investigating 49 illnesses in 10 states linked to McDonald’s Quarter Pounder hamburgers. If you ate a Quarter Pounder hamburger from McDonald’s and have severe symptoms of E. coli, contact your healthcare provider. https://t.co/g87itkupCQpic.twitter.com/gHzUKCnTi9
The CDC says, so far, it appears the onions used as a topping on the burgers are the likeliest source of the outbreak. McDonald’s has now stopped using the onions and is not serving the Quarter Pounder in affected states.
In a statement, the company said it believes the onions came from a single supplier.
Denny’s closing 150 restaurants, including 50 by end of 2024
It seems Denny’s hasn’t been such a grand slam for Americans lately. The diner chain, known for its Grand Slam breakfast, is closing 150 of its restaurants.
Denny’s, which has been in business for more than 70 years, says the focus is on closing locations that are too old to remodel, as well as some in unprofitable areas. It has not yet specified which locations are shutting down.
FAA finalizes rule for electric air taxis to enter service
We might soon be riding around in flying vehicles called electric air taxis after the Federal Aviation Administration released what its say is the “final piece of the puzzle.”
An extraordinary moment for aviation! Our rule for training and certificating pilots to fly powered lift is the final piece of the puzzle to get these revolutionary aircraft flying safely in our skies. https://t.co/96Q7TQZfkMpic.twitter.com/7RvSqbdGT8
The FAA issued its new rules Tuesday regarding the planes — 880 pages of special regulations including training protocols for pilots and operational requirements for the half-airplane, half-helicopter air taxis. The planes act like a helicopter during takeoff then change modes to be more like an airplane during flight, before switching back for the landing.
The FAA calls it the introduction to “a new category of aircraft.” The first electric air taxi could be operational by sometime next year.
If the Waffle House stays open, people often take that as a sign a storm is not likely to devastate their area. However, if the popular breakfast chain closes down, you need to leave – at least according to the Waffle House Index.
The Waffle House Index is a real, though not scientifically backed, measure of how bad a storm is. It’s not just locals who use it, the Federal Emergency Management Agency (FEMA) does too, as a way to identify communities most in need of immediate help after a storm.
Take Hurricane Helene, for example. That storm barreled through six states nearly two weeks ago, causing mass devastation.
In parts of North Carolina and Georgia — which bore the brunt of Helene’s impacts — about two dozen Waffle House restaurants are still closed, and several others are only serving a limited menu.
Waffle House has more than 1,900 locations in the U.S., mostly in the Southeast and mid-Atlantic.
The chain, which normally stays open 24/7, 365 days a year, is known for being well-prepared for disasters and either staying open through them or reopening quickly after. It has a limited menu ready to go for when there are food shortages and power outages. It can even put together “Waffle House jump teams” to quickly reopen restaurants as soon as it’s safe to after a disaster.
Waffle House has been so good at predicting how bad a storm will be that in 2011, then-FEMA Administrator Craig Fugate was the one who created the term Waffle House Index.
The Waffle House Index has three levels: green, yellow, and red. Because Waffle House already has a plan in place for power outages and limited supplies, the index rarely reaches red.
So, what is the Waffle House Index telling us about Hurricane Milton? Things aren’t looking great for parts of Florida directly in its path, with dozens of locations closing to weather out the storm.
Panera settles Charged Lemonade wrongful death suit
Two years after an Ivy League student’s death put the spotlight on a caffeinated beverage from Panera Bread, her family has settled with the restaurant chain. The family of Sarah Katz, a 21-year-old University of Pennsylvania student at the time of her death, reached a settlement Monday, Oct. 7, just days before the case was headed for trial.
The family’s lawyer, Elizabeth Crawford with the law firm Kline and Specter, told Straight Arrow News “the matter has been resolved.” Crawford added she could not comment any further.
According to the wrongful death lawsuit filed in Philadelphia last year, Katz avoided energy drinks because of a heart condition, but ordered Panera’s Charged Lemonade not knowing its high levels of caffeine.
The suit claimed the drink was not properly labeled, described at the time as a “plant-based” option. Katz went into cardiac arrest at the restaurant and later died at the hospital.
A large cup of the beverage contained about 390 milligrams of caffeine, and FDA said a safe quantity of caffeine for healthy adults is typically around 400 milligrams a day.
The family of 46-year-old Dennis Brown of Florida, who lived with a chromosomal deficiency disorder and high blood pressure, sued Panera after he drank the Charged Lemonade and suffered cardiac arrest on his walk home. He died at the scene.
In response, Panera responded the suits had no merit. However, the company would later make changes by adding warnings to the drink’s online description: “Contains caffeine. Use in moderation. Not recommended for children, people sensitive to caffeine, pregnant or nursing women.”
Like Katz, the firm of Kline and Specter also represents Brown and two other plaintiffs who had no underlying health conditions but claim Panera’s Charged Lemonade caused heart injuries.
Straight Arrow News has reached out to Panera for a comment on the settlement.
SpongeBob fans can finally get a Krabby Patty in real life
Nickelodeon is teaming up with a slew of restaurants around the world to bring hungry customers foods inspired by the Krabby Patty — the famous burger from the long-running cartoon “SpongeBob Squarepants.” It’s all part of the show’s 25th anniversary celebration.
“The Krabby Patty Kollab” is bringing the animated meal from the Krusty Krab to real-life eateries, but not just in burger form.
Over 250 participating restaurants will offer a variety of interpretations of SpongeBob’s favorite meal, in more than 100 different styles, including dumplings, falafel, doughnuts and ice cream.
SpongeBob fans craving animated delicacies can find these real-life limited-time menu additions beginning Oct. 8 in cities like New York, Los Angeles, Atlanta, Toronto, London and Mexico City (even though the Krabby Patty recipe remains a coveted secret).
The 25th anniversary of SpongeBob continues later this month at New York Comic Con where Nickelodeon will be setting up a booth recreating the pilot episode of the series. Fans will get the chance to experience the show through 3D-animation and augmented reality.
Push for smaller food portions — and prices — at US restaurants
America is in the midst of an obesity epidemic with no end in sight. And while there are many factors spurring the epidemic, portion sizes could be a big part of the issue — as portions at U.S. restaurants have been creeping up for decades now.
A 2020 study found as much as 40% of the food served at restaurants never gets eaten, and with the continuing rise in people turning to weight loss drugs like Wegovy and Zepbound, diners have been eating less when they do eat out.
Separate research shows more U.S. adults are also turning toward a trend called “snackification” – replacing traditional meals with snacking on smaller portions of various foods throughout the day instead. Then there’s what’s known as “portion distortion” – when you become so used to seeing massive portions, anything smaller feels like you’re getting cheated out of money.
Overall, it’s becoming increasingly clear that Americans want to see change in the restaurant industry, as businesses look for ways to keep up with rising food and labor costs.
After a tease, Rainforest Cafe is actually coming to Big Apple
What began as an April Fool’s joke is now actually happening in New York City. The Empire State Building announced on Wednesday, Sept. 16, that it will in fact host the “World’s Highest Rainforest Cafe.” The famous restaurant will be swinging by the New York City skyscraper’s 86th-Floor Observatory from Oct. 3 through Oct. 6.
However, booking a visit to the Rainforest Cafe may “endanger” some funds. The highest-tiered experience to get into the Empire State Building’s observatory floor will cost around $146 a ticket for adults — and that’s just to get inside. However, there are cheaper options going as low as $44 per adult.
Many were reportedly curious if the prank would become reality. Signs the in-demand restaurant was coming began to surface earlier this month as the cafe’s tree frog mascot Cha! Cha! could be seen hopping around his way around the Big Apple in a TikTok video.
The restaurant has locations across the country and a rainforest-themed menu, including Volcanic Cobb Salad and Amazon Bruschetta. The cafe also sells merchandise and offers other entertainment.
The NYC Rainforest Cafe will be open from 10 a.m. to 6 p.m.
Red Lobster to exit bankruptcy with former P.F. Chang CEO in charge
Thursday, Sept. 5 was touted as “a great day for Red Lobster,” which is good news for the company as there haven’t been many great days for the beleaguered restaurant chain. The place known for its cheddar bay biscuits has seen its fair share of problems in recent years.
The chain dealt with an all-you-can-eat shrimp promotion that hurt profits, a carousel of CEOs, rising food costs, dwindling customer traffic, and the closure of over 100 locations. Red Lobster was tanking and filed for bankruptcy in May.
But now things are looking up for the seafood chain. First there was its collaboration with Flavor Flav, and now a federal judge on Thursday approved Red Lobster’s Chapter 11 plans in its hope to bounce back.
Under those plans, Red Lobster would be under new ownership, RL Investor Holdings, an entity led by Fortress Investment Group along with co-investors. The plan calls for Red Lobster to continue to operate as an independent company.
The $375 million acquisition is expected to close before the end of the month when the newest CEO takes over. Damola Adamolekun is the former CEO of P.F. Chang’s.
It was Adamolekun, who in a statement Thursday, said those words: “This is a great day for Red Lobster.”
The soon-to-be Red Lobster CEO painted a bright outlook for the Orlando-based company, saying there is a commitment from backers of more than $60 million in new funding.
“Red Lobster has a tremendous future, and I cannot wait to get started on our plan with the company’s more than 30,000 team members across the USA and Canada,” Adamolekun said.
Red Lobster currently has 544 locations in 44 states in the U.S. and four provinces in Canada.
Chick-fil-A opening 2-story drive-thru with elevated kitchen
Chick-fil-A is looking to elevate its business model by elevating its kitchen when it opens its first elevated drive-thru-only restaurant on Thursday, Aug. 22, just outside Atlanta. The location will feature four drive-thru lanes with the capacity to support up to 75 cars all under a second-floor kitchen twice the size of a typical Chick-fil-A kitchen.
The restaurant features a conveyor belt that sends the food from above to Chick-fil-A employees on the ground below. Chick-fil-A said this system allows for a meal to be delivered to a team member every six seconds.
Chick-fil-A said it may build more elevated drive-thrus in the future. However, Chick-fil-A is not the only one thinking up these concepts.
In 2022, Taco Bell opened its first two-story drive-thru-only restaurant in Brooklyn Park, Minnesota. Called “Taco Bell Defy,” the restaurant has four drive-thru lanes, an elevated kitchen and no dining room — just like Chick-fil-A’s planned location.
So what is “up” with these two-story drive-thrus and is this the end of the fast food dining room as we know it?
Chick-fil-A said its new drive-thru concept is all about providing greater ease and efficient service for its customers.
As for restaurant dining areas, experts in the industry told Fox Business they are not likely going away any time soon. However, they may start slimming down, taking on new layouts and bringing in more technology to respond to guests’ demands.
In the meantime, these elevated kitchens are just one way fast-food restaurants are hoping to climb above their competition.
Chuck E. Cheese turns to subscription plan to attract inflation-wary families
The eatertainnment chain Chuck E. Cheese is turning a subscription plan to bring back inflation-weary customers. The company is offering a Fun Pass that gives families unlimited visits year-round to all of its 450-plus locations.
The pass comes in three membership tiers ranging from $7.99 a month, which allows 40 games per visit and a 20% discount on food and drinks, to $29.99 a month for 250 games per visit and a 50% discount.
“This is the biggest, best deal Chuck E. Cheese has ever offered,” Chuck E. Cheese Executive Vice President Mark Kpuferman said in a statement. “We understand families are struggling to find affordable entertainment options outside the home right now.”
Kupferman cited rising costs as a reason for the need for a membership plan. He said it is a way to make Chuck E. Cheese more affordable for families.
This is not the first time a restaurant chain has offered a membership program. Panera Bread, Sweetgreen and P.F. Chang’s all implemented subscription plans in the past. And remember Olive Garden’s lifetime pasta pass?
As other chains like Red Lobster and Buca di Beppo have filed for bankruptcy this year. Chuck E. Cheese — which already emerged from bankruptcy four years ago — looks to avoid that same fate, hoping the membership route brings in the parents and kids. If not, it could go with Auntie Anne’s Pretzels’ plan to attract customers: creating a perfume.
