Burger King Franchisee Files for Bankruptcy After $100M Financial Crisis.

Consolidated Burger Holdings, which runs 75 Burger King restaurants across Florida and Georgia, has filed for Chapter 11 bankruptcy. The filing landed in federal court in Florida, marking a dramatic turn for the once-thriving franchisee.

In court documents, the company revealed it owes tens of millions of dollars and has more than 200 unpaid creditors. This collapse adds to a growing trend of financial trouble sweeping through the fast-food world.

Legal Battles and Financial Pressure

The road to bankruptcy has been anything but sudden. Consolidated had been in a drawn-out legal fight with Burger King Corporation over a franchise agreement that dates back to 2019. While both sides reached a settlement last fall, the damage had already been done.

Burger King is still owed more than $2.4 million in unpaid fees. Other debts include unpaid rent, vendor invoices, and operational costs that spiraled out of control.

Trying to Survive with Chapter 11

Filing for Chapter 11 gives Consolidated a shot at turning things around without shutting down its restaurants. The company secured a $1.6 million emergency loan known as debtor-in-possession financing, which helps keep the lights on during the legal process.

That money will go toward payroll, rent, and daily expenses while the company figures out its next move.

Two related entities, Consolidated Burger A and B, are also part of the bankruptcy. A restructuring expert, Joseph J. Luzinski, is now leading the company through the process, with legal support from Berger Singerman LLP.

Why This Case Matters to Franchise and Bankruptcy Lawyers

This situation raises real concerns for anyone working in franchise or insolvency law. The case offers a front-row look at what happens when a franchise breaks down under legal and financial pressure.

Some key takeaways:

• Legal disputes with franchisors can linger for years and drain resources even after they’re “resolved.”

• Emergency loans like DIP financing are often the only way to stay open during restructuring, but they come with conditions.

• Franchisees with large footprints and staff face even bigger ripple effects when things go wrong.

If this all sounds familiar, it’s because the industry has seen it before. Back in the early 2000s, a massive Burger King franchisee called AmeriKing went bankrupt after operating nearly 400 locations.

Today, the issues are different, but just as intense. Labor costs are rising, prices are going up, and customers are shifting their spending habits. That’s putting more pressure on franchisees who are stuck in old contracts and outdated operating models.

Franchise Failures and Fast Food Law 

• Burger King has lost multiple franchisees to bankruptcy in the past decade, including TOMS King and Meridian Restaurants, both of which also cited rising costs and franchise disputes.

• Chapter 11 isn’t uncommon in fast food. Competitors like Subway and Pizza Hut have also seen franchisees restructure or close hundreds of locations to cut losses and renegotiate leases.

• AmeriKing, once Burger King’s largest U.S. operator, filed for bankruptcy in 2002 with nearly 400 locations—foreshadowing the risks of rapid expansion without financial flexibility.

• Debtor-in-possession (DIP) loans, like the $1.6 million secured by Consolidated, are becoming more common in franchise bankruptcies. They help businesses survive—but often come with tight oversight from lenders and the court.

• Florida and Georgia, where Consolidated operated, are both top-ten states for franchise litigation volume, making them hotspots for legal disputes involving major QSR brands.

• Burger King’s modernization plan, announced in 2022, promised $400M in investment—but franchisees were required to co-invest or risk falling behind. Some couldn’t keep up, leading to closures or sell-offs.