Major Pizza Chain Closes Abruptly

Clear Facts

• Over a dozen Pizza Hut restaurants in northwestern Indiana, managed by franchisee EYM Group, have abruptly closed.
• EYM Group and Pizza Hut have been involved in a legal tussle, with both parties accusing each other of contract breaches.
• Pizza Hut has stated its commitment to excellent service and is working on transitioning the closed locations, with many expected to reopen soon.

A sudden wave of Pizza Hut closures occurred in Indiana recently. A total of 15 Pizza Huts, located in the northwestern part of the state and operated by the franchisee EYM Group, have unexpectedly shut down.

Recent reports revealed these abrupt closures are seemingly a consequence of ongoing legal disputes between EYM Group and Pizza Hut, with allegations of contract breaches from both sides.

In a lawsuit filed earlier this month, Pizza Hut accused EYM Group of violating the terms of its franchise agreement and a subsequent forbearance agreement reached in 2023. The pizza chain claimed that EYM had a “history of late paying fees owed to Pizza Hut and other interested entities pursuant to the Franchise Agreements” and that it defaulted on these obligations in several instances.

EYM Group has also claimed that Pizza Hut did not fulfill its contract obligations. The franchisee took issue with Pizza Hut’s supposed failure to “adapt to modern business practices” and to “keep up with new technology,” which it argued negatively impacted EYM and its financial status. The franchisee also cited inflation and the COVID pandemic as exacerbating factors.

There is speculation that dozens more Pizza Hut locations overseen by EYM Group could also temporarily shut down. Pizza Hut, however, has reassured customers of its commitment to service and product quality. “While a few EYM franchise-operated restaurants in Indiana have temporarily closed, Pizza Hut remains committed to providing outstanding service and products to our valued customers,” a company spokesperson stated.

The company confirmed it’s making efforts to transition these locations and anticipates that many will resume operations soon. EYM Group operates Pizza Hut restaurants not only in Indiana, but also in Georgia, Wisconsin, and several other states.

EYM Group’s portfolio extends beyond Pizza Hut, as it also franchises for other fast-food brands, including Denny’s, KFC, and Panera Bread. Yum! Brands reported in its latest quarterly earnings that over 99% of Pizza Hut outlets were run by franchisees as of the end of March.

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