Pizza Hut has abruptly closed 15 restaurants across the Midwest after getting locked in a bitter legal battle with franchisees, with more than 120 more at risk of closure.
EYM Group, which owns and operates 142 Pizza Hut restaurants in Illinois, Indiana, Georgia, South Carolina and Wisconsin, is accused of failing to make millions of dollars in payments it allegedly owes to Pizza Hut by a June deadline.
Pizza Hut abruptly closed 15 locations in Northwest Indiana on Friday. The Northwest Indiana Times reports.
The Times of Northwest Indiana cited social media posts by employees.
EYM blames Pizza Hut for failing to modernize its menu and digital ordering system, putting it at a disadvantage in the face of stiff competition from casual dining companies including Little Caesars and Domino’s.
EYM Group filed a lawsuit against Pizza Hut in March 2023 for breach of contract.
Pizza Hut filed a countersuit earlier this month, alleging that EYM Group was plagued by financial discrepancies and breached its franchise agreement by failing to make required payments.
Pizza Hut entered into forbearance agreements with franchisees last year after several defaults.
The Post has reached out to Pizza Hut and EYM Group for comment.
Pizza Hut’s parent company, Yum! Brands, said last month that Pizza Hut’s same-store sales fell 7% in the most recent quarter.
In the U.S., Pizza Hut’s same-store sales fell 6%, a sharp drop from the 7% increase in same-store sales in the same period last year.
Shares of Yum! Brands, whose subsidiaries include KFC and Taco Bell, have risen about 6% since January 1.
