Boston Market is appealing a January ruling awarding US Foods a $15 million default judgment over unpaid bills.
The rotisserie chicken chain filed a notice Monday indicating that it has filed an appeal with the U.S. Seventh Circuit Court of Appeals. Boston Market had argued that US Foods overcharged for supplies and also accused the distributor of failing to keep enough product on hand to supply its restaurants.
The appeal continues the ongoing legal saga of Boston Market and its owner, Jay Pandya. US Foods sued the company last year, claiming that Boston Market failed to pay bills for distribution and then reneged on an agreement to make payments on those bills.
Boston Market took months to answer the lawsuit. When it did answer, US Foods said the response was “rife with problems” and accused the company of engaging in delay tactics.
A federal court judge agreed, and in January chastised Boston Market for having a “willful disregard” for the litigation.
“The amount sought in damages is a large sum, but for a company with a national brand identity, it is not disproportionate to the willful disregard defendants have shown for this litigation,” US District Court Judge Manish Shah said in the ruling. Shah issued the default judgment and also dismissed Boston Market’s response to the lawsuit and its counterclaim that US Foods charged too much for food.
But Boston Market argued that it didn’t know about the lawsuit for weeks, even though Pandya had been questioned about it shortly after the filing. It also argued that any delay was not that long in the world of litigation, and that it had been timely filing responses for several weeks before the judgment was handed down.
In the meantime, Pandya himself has twice filed for personal bankruptcy. He and his wife filed for personal bankruptcy in December, including the US Foods debt among liabilities. That filing was later terminated after Pandya didn’t provide insurance information on a pair of rental properties.
He filed for bankruptcy again this month, again featuring the US Foods debt among the liabilities.
Boston Market in January also said that it would let anyone serve Boston Market branded food inside an existing business without any buy-in requirements, and also said it would start selling foods from different countries.
The actions all come as Boston Market itself is in freefall. The company has been sued more than 150 times since Pandya bought the chain in 2020, mostly over unpaid bills. The chain has likely closed about two-thirds of its locations since the start of 2023, largely as its restaurants are evicted over unpaid leases.
(For more information, check out The Demise of Boston Market.)
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