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More than a dozen Pizza Hut locations in Indiana suddenly closed earlier this month.
The 15 restaurants are located in northwest Indiana and are operated by franchisee EYM Group. Northwest Indiana Times It was reported last weekend.
The news of the closures comes as EYM Group and Pizza Hut are in the midst of litigation against each other, with both sides alleging breach of contract.
Breadsticks and pepperoni pizza from Pizza Hut restaurants, a subsidiary of Yum Brands Inc. (Patrick T. Fallon/Bloomberg via Getty Images/Getty Images)
Pizza Hut alleged in its June 7 lawsuit that EYM Group violated its franchise agreement and a subsequent 2023 grace period agreement.
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According to the lawsuit, the pizza chain alleged that EYM has a “history of delaying payments of fees due to Pizza Hut and other related parties under the franchise agreement” and has missed payments on several occasions.
EYM Group has been trying to sell Pizza Hut restaurants for some time and has previously claimed that Pizza Hut has not met its contractual obligations.
The company’s allegations included Pizza Hut’s “failure to adapt to modern business practices” and “failure to keep up with new technologies,” which it said had adversely affected EYM and its financial condition. Inflation and the coronavirus exacerbated the situation, it said.
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Dozens of Pizza Hut restaurants operated by EYM Group may also be forced to close. According to the Daily Mail.
The Pizza Hut logo appears on a box in Krakow, Poland on April 20, 2024. (Jakub Porzycki/NurPhoto via Getty Images)
“While several EYM franchised restaurants in Indiana have temporarily closed, Pizza Hut remains committed to providing great service and products to our valued customers,” a Pizza Hut spokesperson told FOX Business. “We are working to transition these locations, many of which should reopen soon. All other franchised restaurants outside of the Indiana market will remain open.”
EYM also operates Pizza Hut restaurants in Georgia, Wisconsin and several other states.
The company also franchises other fast-food brands, including Denny’s, KFC and Panera Bread, according to its website.
In its most recent quarterly earnings report, Yum! Brands said that more than 99% of Pizza Hut restaurants were franchised as of the end of March.
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