For long, the Roscoe's House of Chicken and Waffles has been a legendary culinary institution in Los Angles, which has been offering southern comfort food and was often visited by celebrities like Magic Johnson and Snoop Dogg. However, things are likely to change now as the parent company, East Coast Foods Inc., has filed for Chapter 11 bankruptcy protection.
The bankruptcy filing came just a few months after the Long Beach chain was in trouble following directives to pay $3.2 million to one of its former employee who won an unlawful termination and inequity lawsuit against the East Coast Foods Inc. The Chapter 11 bankruptcy filing is a move to help the company bail itself out of debt origination from a string of crushing lawsuits as well as various financial irregularities, Food Beast reported.
According to an estimate prepared by the U.S. Bankruptcy Court in California, East Coast Foods Inc. may possibly owe the creditors anything between $10 million and $50 million, the Los Angeles Times reported. On the other hand, the total assets of the company are valued at less than $100,000.
Lawyers for the Long Beach chain, however, did not respond to a request for comment. Moreover, in its court filings, East Coast Food Inc. did not mention whether or not the bankruptcy would have any effect on the day-to-day operations of the company's seven Southland Roscoe's restaurants.
The popular Southern California eatery chain has been plagued by legal troubles for a few years now. The latest blow was when the company lost a workplace discrimination and wrongful termination lawsuit filed by a former employee, Daniel Beasley, in 2015. In his lawsuit, Beasley, who is African-American, accused Roscoe's of alleged "preferential treatment to Latino employees," by an all-Latino staff. Eventually, Beasley was awarded $1.6 million in compensation. In addition, Beasley was also awarded $1.5 million in attorney's fees.
However, East Coast Food Inc.'s problems did not end with losing the lawsuit to Beasley, as the company faced another lawsuit in 2011 for copyright infringement by the Music Publishers' Association of The United States. Rumor has it that, The Roscoe's LBC location has a side lounge where live musicians perform, however, a license is required to play specific copyrighted songs. Roscoe's failed to pay any licensing fees. The court awarded the plaintiff, Range Road Music Inc., more than $160,000.
While East Coast Foods listed Beasley as one of its largest unsecured creditors in court filings, bankruptcy experts consider that the Chapter 11 filing may have been triggered by something beyond the original judgment.
