Photo of Jack in the Box restaurant

On February 16, 2021, Illinois Jack LLC and Missouri Jack LLC — the owners of 70 Jack in the Box restaurants in Illinois and Missouri — filed for Chapter 11 bankruptcy, according to the US Bankruptcy Court for the Eastern District of Missouri. 

The filing follows a drop in sales across multiple locations in both states during the COVID-19 pandemic. While it may seem like fast-food restaurants’ preexisting takeout and drive-thru options would help them survive the economic fallout of the pandemic, this has not been the case across the board.

According to a November 3, 2020 article in Business Insider,  fast-food chain Steak ’n Shake announced in 2020 it would permanently close over 50 locations. Bloomberg reported in February 2021 that Steak ’n Shake may also file for Chapter 11 bankruptcy soon, as a deadline approached for the restaurant chain to repay a $153 million loan. 

In 2020, many large American fast-food chains — including industry giants McDonald’s and Burger King — announced location closures. In July, McDonald’s announced it would close 200 restaurants, more than half of which resided in Walmart stores. In August, Burger King said it expected to close 200-250 low-volume locations a year over the next couple of years. Additionally, “fast-casual” restaurant chain Fuddruckers is currently seeking a buyer for all of its remaining locations (31, as of November 2020). 

Jack in the Box began to see the effects of decreasing sales at a national level early on: An April 15, 2020 report in The San Diego Union-Tribune stated Jack in the Box saw same-store restaurant sales plummet by 17% after March 8, 2020. This was after same-store sales had improved by 5.2% over the first seven weeks of 2020. 

According to the bankruptcy filings, Missouri Jack owns and operates 57 Jack in the Box restaurants in Missouri, employing 1,338 full-time workers. Illinois Jack owns and operates 13 restaurants in Illinois with 332 full-time employees. 

Business in both states was further hindered due to the suspension of indoor dining in November 2020 — a result of riding COVID-19 cases in the area. St. Louis County, Missouri, the location of one-third of the Jack in the Box restaurants in Missouri, suspended all indoor dining services on November 17, 2020.

Madison County, Illinois — home to more than half of the Jack in the Box restaurants in Illinois — enacted the same ban on November 4. The Missouri ban was lifted on January 5, 2021, but Illinois only saw indoor dining return at the beginning of February. 

Illinois and Missouri Jack owe $10-50M to 150+ combined creditors

Illinois Jack LLC listed assets of $1-10 million and liabilities of $10-50 million in bankruptcy documents. Missouri Jack LLC listed assets of $10-50 million and liabilities of $10-50 million. Illinois Jack estimated it had 50-99 creditors and Missouri Jack estimated it had 100-199 creditors. 

Missouri Jack listed the following construction-related companies among its creditors: 

  • AM Total Service, LLC 
  • Bluegrass Lawn Care of St. Louis LLC 
  • Lecocq Grounds Service 
  • MC2 Enterprises Inc. 
  • Pro Lawns Inc. 
  • Case Parts Company
  • CCS LLC DBA Roof Medics 
  • Commercial Pumping Service LLC 
  • Hirsch Lawncare and Construction 
  • Overhead Door Company of St. Louis 
  • Plumbers Supply 
  • SC Electric Inc. 
  • SSD Systems Inc. 

Of those companies, Lecocq Grounds Service, AM Total Service LLC, Pro Lawns Inc., and MC2 Enterprises are the only ones that rank among the 20 largest unsecured claims that are not from insiders. Missouri Jack’s largest unsecured claim was from American Express for $167,779.31. 

Illinois Jack listed the following construction-related companies among its creditors: 

  • AM Total Service LLC 
  • Case Parts Company 
  • CCS LLC DBA Roof Medics 
  • Commercial Pumping Service LLC 
  • Federal Fire Control LLC 
  • Home Depot 
  • Jewett Roofing Company 
  • MC2 Enterprises Inc. 
  • Rottler Pest and Lawn Solutions 
  • SSD Systems 

Of those companies, AM Total Service LLC, Lecocq Grounds Service, and MC2 Enterprises Inc. are the only ones that rank among the 20 largest unsecured claims that are not from insiders. Illinois Jack’s largest unsecured claim was from American Express for $49,613.95.