Bankrupt Popeyes Franchisee Sues Buyer Over $2.5M Deposit from Terminated Sale
A bankrupt Popeyes franchise operator, Sailormen, is suing RFI Ventures after the buyer terminated a deal to purchase 23 restaurants in Florida this summer. The asset purchase agreement included a $2.5 million deposit that was supposed to be forfeited if the sale fell through under certain conditions. According to court documents filed by Sailormen, RFI backed out of the transaction on July 12 due to reported HVAC and equipment issues but failed to follow proper termination procedures outlined in the contract. Sailormen claims it is entitled to retain the $2.5 million as liquidated damages under the terms of their agreement. The buyer had initially paid a smaller deposit, later increasing it to cover the full purchase price, which Sailormen argues was understood by RFI as part of the deposit. With time constraints on closing the deal, no formal amendment redefined this payment structure. The dispute highlights ongoing legal and financial challenges in franchise transactions during bankruptcy proceedings.
Topics: bankruptcy franchising lawsuit Popeyes