One of the largest Wendy's franchisees in America just filed for Chapter 11 bankruptcy — and 9,000 workers are wondering if their paychecks survive the restructuring.
Meritage Hospitality Group, which operates 314 Wendy's locations across 15 states, filed for bankruptcy protection Thursday in the U.S. Bankruptcy Court for the Western District of Michigan. The Michigan-based operator reported a $31.5 million net loss in 2025 — a freefall from $8 million in net income the year before, according to court documents cited by Fox Business. Store-level earnings cratered 48%.
This is what the real economy looks like while Wall Street cheers. The same week a British AI infrastructure startup called Nscale announced plans for a U.S. IPO — the kind of story Investor's Business Daily covers as a market opportunity — a company that actually feeds people and pays working Americans is drowning in debt.
Meritage CEO Bob Schermer Jr. told investors the culprit is no mystery: soaring beef costs and weak customer traffic. The franchisee also blamed aggressive promotional discounting by Wendy's corporate for squeezing margins to the breaking point. Translation: corporate pushed discounts to move product, and the operators who actually cook the burgers ate the loss.
The dispute between Meritage and Wendy's corporate turned hostile before the filing. Wendy's franchising unit issued a Sept. 16 notice seeking to terminate Meritage's franchise rights and lease occupancy
