Jack in the Box

Financing

Franchisee sues Jack in the Box, claiming 'millions' in damages

Gulf Coast Jacks, a franchisee out of Houston, is accusing the fast-food chain of a litany of problems, including cannibalizing its stores with new locations, marketing problems and royalties on delivery orders.

Financing

Jack in the Box, which is closing restaurants, asks a court to keep some open

The fast-food chain is asking a court to prevent a franchisee from closing restaurants in a dispute over unpaid marketing fees. The franchisee sued the brand last year over what it called an improper termination.

The fast-food chain’s shareholders voted to re-elect all 10 directors, beating back a “vote no” effort on Chairman David Goebel. But it named a former Taco Bell CEO its new chairman.

The fast-food chain’s stock plunged 16% on Thursday after the company’s fiscal year started off worse than expected, while beef costs hurt profits. But executives said January started better.

The Bottom Line: The longtime activist, the burger chain’s largest shareholder, is targeting David Goebel with a “vote no” campaign in one of the restaurant industry’s most unusual proxy fights.

The Bottom Line: The fast-food burger chain just sold Del Taco after just four years. Its sales are struggling badly. And it faces an activist investor in Sardar Biglari.

Same-store sales at the fast-food burger chain declined 7.4% last quarter as customers came in less often and spent less money when they did. Higher commodities also hit profit margins.

The activist investor Sardar Biglari nominated himself and one other person to the fast-food chain’s board. But then Jack in the Box turned around and added two itself, including the former CEO of Taco Bell.

The Bottom Line: The Del Taco sale, four years after it was acquired, revealed just how much industry thinking has changed over that time. Fast-food chains were supposed to win. But these days they are not.

Jack in the Box and Wendy’s are offering new price promotions as they push back against their rival’s Extra Value Meals. Not everybody is biting, however.

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