Pizza Hut has abruptly closed 15 locations in the Midwest, and more than 120 are at risk of closing as the chain becomes embroiled in a bitter legal dispute with a franchisee.
EYM Group, which owns and operates 142 Pizza Hut locations in Illinois, Indiana, Georgia, South Carolina and Wisconsin, was accused of not paying millions of dollars owed to Pizza Hut by a June deadline.
Pizza Hut abruptly closed 15 restaurants in northwest Indiana on Friday, according to a report from the Times of Northwest Indiana.
The Times of Northwest Indiana cited social media posts by employees.
EYM has accused Pizza Hut of failing to modernise its menu as well as its digital ordering system – leaving it at a disadvantage against strong competition in casual dining, including Little Caesars and Domino's.
EYM Group filed a lawsuit against Pizza Hut in March 2023, alleging breach of contract.
Pizza Hut filed a counterclaim earlier this month, alleging that EYM Group was beset by financial discrepancies and had failed to make required payments – thus violating the franchise agreement.
After defaulting on payments several times, Pizza Hut entered into a forbearance agreement with franchisees last year.
The Post has sought comment from Pizza Hut and EYM Group.
Yum Brands, Pizza Hut's parent company, reported last month that Pizza Hut's same-store sales declined 7% in the most recent quarter.
In the U.S., Pizza Hut's store sales fell 6% – a steeper drop than the 7% increase in store sales during the same period last year.
Shares of Yum Brands, whose subsidiaries include Kentucky Fried Chicken and Taco Bell, have risen about 6% since Jan. 1.