Penguin Drive-In Files for Bankruptcy Protection

by San Antonio Attorney

The manager of Penguin Drive-in filed for Chapter 11 bankruptcy protection Thursday morning. The burger joint owes around $300,000 to different creditors and could not pay. Penguin Drive-in closed for ten days before the bankruptcy case was filed.

In statement last Aug. 4, Penguin Drive-in manager Lisa Ballentine explained that the cause of the closure was the death of a family member of one of their staffs. She said the restaurant will reopen, but it did not. On Aug. 6, there was a notice from Piedmont Natural Gas posted on its front door. The telephone number of the restaurant has also been discontinued.

Penguin Drive-in is facing eviction because it owes rent to the landlord of its property, 1921 Commonwealth Ave. Holdings, LLC. The eviction papers were filed on Aug. 4, stating that the drive-in restaurant was supposed to pay $4,500 in rent every month until May 31, 2015, which is the expiration of the lease. Court papers also show that the building looks like it has been “abandoned.”

The bankruptcy filing took place just before the 10:00 a.m. eviction hearing. Regardless of the bankruptcy, the property owner will still be able to proceed with the eviction process against Penguin Drive-in.

After Ballentine filed for Chapter 11, she announced that they will reopen in the following week.

Court papers show the restaurant has around $50,000 in assets and more than $300,000 in debt, which includes $140,000 to the IRS and $20,000 to the N.C. Department of Revenue.

Penguin Drive-in is renowned for its burgers and fried pickles and has appeared on the Food Network programs. Since 2010, the business has been having financial problems, which includes a lawsuit from the property owners claiming the Ballentine’s defaulted on a loan. That case was eventually dismissed.

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