Meritage Hospitality Group filed for Chapter 11 on Sept. 17, putting 34 West Tennessee Wendy’s—mostly around Memphis—at risk of permanent closure; some were already closed by late September. Wendy’s franchisor disputes Meritage’s right to keep operating.
Quality Is Our Recipe, Wendy’s franchisor, argues Meritage’s franchise agreements ended Aug. 18; Wendy’s says it issued a termination notice Sept. 16 and Meritage lost its rights when it filed the next day. Quality Is Our Recipe claims $27.4 million in past-due obligations and another $119.5 million in fees and contractual damages. Wendy’s said it would consider a temporary license during a transition or wind-down.
Meritage attributed its filing partly to an 11.3% same-store sales decline in the final quarter of 2025, unusual winter weather, reduced effectiveness of Wendy’s brand marketing and record U.S. beef prices. It said its average beef costs rose 18.9% year over year. The company also asked permission to continue paying its 8,850 employees and honoring Wendy’s gift cards and loyalty programs.
