Unveiling the Controversial Past of Boston Market's Owner

In this comprehensive four-part series, we delve into the enigmatic world of Jay Pandya, the owner of Boston Market. In today's installment, we spotlight his controversial history within the restaurant industry, entailing lawsuits, a high-profile cricket dispute, and unsettling allegations of deceiving investors.

Today: Inside the Chaotic World of Boston Market's Owner

In an unforeseen twist, Jay Pandya emerged in 2020 as a prominent multiconcept restaurant chain owner. His company, Rohan Group, sent shockwaves through the industry when it unexpectedly acquired Boston Market, a chain that had been struggling even before the pandemic and was hastily sold off by private equity firm Sun Capital, which was eager to divest and repay debt.

Pandya went on to outbid competitors for another ailing fast-casual chain, Corner Bakery, previously owned by Roark Capital. With grandiose promises of resurrecting these brands to their former glory, Pandya embarked on an ambitious journey. He boasted about signing 30 leases for Boston Market within months and, in the subsequent year, proclaimed that the chain was opening two new locations per week.

However, rather than revitalizing these brands, Pandya's tenure took an unexpected turn: he imposed severe cost-cutting measures, demanding that employees cease bill payments without substantial discounts, often reaching up to 70%. In some cases, bills remained unpaid. The financial operations of his business seemed centralized, with a single employee handling finances through QuickBooks.

The repercussions were significant – Corner Bakery's Dallas headquarters and Boston Market's corporate offices in Golden, Colo., were temporarily inaccessible due to unpaid bills. This financial instability led to the abrupt closure of numerous restaurants, without prior notice, spanning from Massachusetts to downtown Chicago to suburban Los Angeles.

What ensued were more than 200 lawsuits against both chains during Pandya's three-year stewardship, primarily revolving around unpaid bills. Corner Bakery eventually filed for bankruptcy and changed hands, while Boston Market appeared to spiral towards a grim fate, marked by canceled food distribution contracts, unpaid employees, and restaurants seemingly shuttering by the day.

Amid this turbulence, allegations of irregular asset transfers and exorbitant management fees began to surface. In the case of Corner Bakery, Pandya was accused of treating it as his personal "piggy bank."

However, Pandya's controversial history in the restaurant industry predates his ownership of these two chains. As a franchisee of various brands, his track record is marred by lawsuits from lenders and landlords for unpaid obligations. Multiple franchisors terminated their agreements with him for various reasons, including subpar performance, unpaid franchise fees, breaches of contractual obligations, and even accusations of investor fraud. Astonishingly, at least one investor asserted that Pandya had misappropriated $1 million earmarked for investment in some of his restaurant ventures.

This series draws from extensive interviews with current and former employees of both chains, legal experts, and a thorough review of legal documents encompassing scores of lawsuits filed in state and federal courts. Additionally, we conducted four hours of interviews with Pandya himself, seeking insights into these intricate matters.

A Glimpse into Pandya's Controversial Past: The Would-Be Cricket Tycoon

Jay Pandya, born in Vadodara, India, transitioned to the United States during his teenage years and currently conducts business in suburban Philadelphia. Beyond his culinary endeavors, Pandya has been involved in cricket, even owning a professional team in St. Lucia, or so it seemed.

However, the Caribbean Premier League took a surprising step by terminating its agreement with Pandya's Royal Sports Club. The reason? Failure to compensate franchise players. Pandya, when questioned about the matter, deflected inquiries about his team, directing them to his business partner.

In Pandya's self-descriptions through blog posts, he paints himself as a "business tycoon" and a committed philanthropist. Those who have encountered him describe him as charismatic, occasionally unpredictable, and prone to hyperbolic statements. His lavish lifestyle includes an opulent residence housing an impressive collection of luxury vehicles, including a Bentley and a Lamborghini.

Throughout his career, Pandya appeared adept at overcoming challenges and convincing lenders to grant him opportunities despite his turbulent track record. One associate noted that while Pandya possessed financial acumen, he seemed ill-equipped to run a restaurant concept effectively.

Pandya also dabbles in commercial real estate investment and owns properties across the Philadelphia area, alongside a construction firm. Many of his ventures have attracted substantial attention, only to eventually fizzle out. Among these, none garnered more anticipation than his ambitious plan to introduce cricket, the world's second-most popular sport, to the United States.

In 2016 and 2017, Pandya's audacious proposal entailed investing $2.4 billion in constructing 26,000-seat stadiums nationwide, including New York, California, Florida, Texas, and Illinois. His cricket venture was intended to usher professional cricket into the U.S. arena.

Yet, this grand vision remained unrealized. Governing bodies such as USA Cricket and the International Cricket Council opted for a different consortium to introduce cricket in the U.S., resulting in Pandya's American Cricket Premier League filing a lawsuit in 2019. However, this legal action was subsequently dismissed.

To this day, Pandya firmly believes that his proposal was superior, insisting that his competitor secured rights at a mere fraction of the cost due to political connections.

The Investor's Tale

Jagdish Patel's encounter with Jay Pandya took place at a New Jersey party in 2010. Pandya, flaunting a net worth exceeding $100 million and a portfolio encompassing commercial properties in both the U.S. and India, regaled Patel with his tales of prosperity.

With funds bequeathed by his late wife, Patel sought an investment opportunity for his son's future. Pandya extended an offer: invest in the acquisition of nine Pizza Hut restaurants in Connecticut, along with plans for an additional 20 restaurants in a development deal. Patel, trusting Pandya's narrative, furnished him with $350,000 in cash.

Later, Pandya requested an additional $135,000 to cover liquor licenses and attorney's fees. Patel, still confident in Pandya's assurances, dispatched an additional $480,000 to facilitate the acquisition of Pizza Hut locations in New Jersey, with the understanding that Patel would oversee the restaurant operations.

However, Patel's trust would be shaken, leading him to file a lawsuit against Pandya in 2015. The lawsuit alleged that Pandya had pocketed the funds without utilizing them for the agreed-upon purpose. Remarkably, Pandya funded the $1.4 million acquisition of the Connecticut restaurants independently, failing to deliver the promised 25% stake to Patel. The lawsuit also exposed that the Connecticut Pizza Hut locations had engaged Pandya's management company for a hefty annual fee of $650,000. Furthermore, the initial purchase price included liquor licenses, rendering the additional funds unnecessary.

Notably, the New Jersey deal never materialized as envisioned.

When Patel confronted Pandya, according to the lawsuit, Pandya produced manipulated purchase documents that inflated the Connecticut restaurant acquisition price and omitted the inclusion of liquor licenses. The lawsuit was initiated in 2015, with Pandya initially refuting the allegations. Legal proceedings endured repeated delays as Pandya rotated legal representation. Eventually, Pandya assented to repaying Patel without interest, through annual installments of $110,000 commencing in 2022. However, Pandya missed this year's payment.

Pandya justified the settlement by citing a desire to avoid accruing attorney's fees. When queried about the missed payment, he assured that it would be settled within approximately two weeks. As of the time of this writing, the payment has not been made, as confirmed by Patel's attorney. In a recent development, a judge ruled in favor of Patel, awarding him $1.3 million, plus interest and legal fees.

This lawsuit was not the sole instance where Pandya was accused of misappropriating investor funds.

A Controversial Franchisee Career

Jay Pandya's involvement in the restaurant industry spans over two decades. At one juncture, he held the distinction of being one of the nation's largest franchisees, presiding over a portfolio exceeding 100 restaurants distributed across Connecticut to Alabama, spanning four prominent chains: Dunkin', Checkers, Popeyes, and Pizza Hut.

Pandya's businesses operated under myriad names, often listing his son Ronak as the legal owner of Corner Bakery. Overseeing this extensive web of entities was the Rohan Group of Companies, named after another of Pandya's sons.

This intricate arrangement complicated attempts to track the organization's dealings and sometimes facilitated asset transfers between different entities. However, three out of four franchised brands ultimately terminated their agreements with Pandya, culminating in lawsuits against both him and his companies.

Dunkin' took steps to terminate Pandya's restaurants in Pennsylvania and New Jersey in 2011, asserting that he had defrauded a trio of investors, collectively losing $860,000. Pandya countered with a lawsuit, accusing Dunkin' of permitting new restaurants to open in proximity to his units. Astonishingly, the parties reached a settlement merely four months after filing the initial lawsuit.

In 2020, Pandya divested his remaining Dunkin' restaurants just before acquiring Corner Bakery to preempt any potential conflicts of interest. His Popeyes restaurants had already been sold off in 2011.

Nonetheless, his stints as a Checkers and Pizza Hut operator unraveled dramatically in 2019, marked by terminations, legal battles, and intricate financial maneuvers.

The Checkers Sale

Pandya attributed the sudden sale of his 45 Checkers restaurants in 2020 to Pizza Hut, which he claimed precipitated by his decision to close underperforming Pizza Hut locations in Connecticut. This move reportedly perturbed his lender, First Franchise Capital Corp., leading to a lawsuit filed against Pandya in 2019 and the subsequent placement of his operations under receivership. The debt owed to First Franchise amounted to a staggering $18 million, with both Pizza Hut and Checkers outlets serving as collateral.

Within a brief span of 30 days, the court-appointed receiver sold Pandya's Checkers restaurants. Subsequently, efforts were expended over three months to sell his Pizza Hut locations. However, according to Pandya, Pizza Hut allegedly obstructed the sale process, contributing to the lender's exasperation.

To navigate this impasse, Pandya founded a new company named Ronak Capital, which acquired the debt at a discounted rate from the secondary market. In this unconventional move, Pandya effectively became his own lender, thereby terminating the receivership and retaining ownership of his Pizza Hut restaurants.

Through this process, First Franchise Capital Corp. contended that Pandya had fallen behind on $18 million in loan payments, a claim further compounded by Checkers' termination of Pandya's restaurants due to unpaid franchise fees. This dual predicament prompted the bank to seize control of the restaurants to prevent their closure, citing concerns over health and safety violations at some of Pandya's establishments. The lender also expressed apprehensions about the imminent closure or managed deterioration of his 40 Pizza Hut restaurants.

Checkers pursued legal action against Pandya in 2020 and secured a $1.4 million award through arbitration the previous year. Although Pandya made the initial payment, he defaulted on the subsequent installment, compelling Checkers to seek garnishment of his company's bank accounts, totaling $1.23 million. Eventually, Pandya settled the outstanding amount before garnishment proceedings commenced.

Pandya faced a fresh lawsuit in 2023 from his lender, Signature Financial, concerning eight of the Checkers locations. His company had fallen behind on loans amounting to approximately $2.8 million. Notably, these Checkers locations were listed as temporarily or permanently closed, signifying Pandya's exit from the Checkers franchise.

The Ongoing Pizza Hut Predicament

While Pandya succeeded in retaining control of his Pizza Hut restaurants by acquiring the debt, the specter of potential termination continued to loom. Pizza Hut initially terminated Pandya's restaurants in 2018 due to unpaid royalty and ad fund fees. A grace period was provided to Pandya, conditional upon settling the outstanding dues. Regrettably, he failed to meet these obligations.

In 2019, Pizza Hut filed a lawsuit against Pandya, alleging that he continued to operate restaurants after their termination. Moreover, it accused him of establishing an alternative concept named Mozzarella Kitchen Co. with intentions of converting closed Pizza Hut units. Pandya's efforts to rebrand some locations into a chicken chain known as HNT also proved futile.

Pizza Hut emerged victorious in this lawsuit, securing an $11 million judgment in the subsequent year. As a consequence, certain Pizza Hut locations ceased operations, while others were sold to different franchisees.

Pandya faced another lawsuit by Pizza Hut in early 2023, contending that he obstructed efforts to provide financial documentation as part of the judgment collection process. Subpoenas of Pandya's bank records unveiled over $1 million in transfers from his accounts to entities owned by his wife and other affiliated entities since 2020. Intriguingly, Pandya claimed to be unaware of this lawsuit.

Remarkably, Pizza Hut encountered difficulties in serving Pandya with the lawsuit, as process servers were unable to gain access beyond the perimeter gate of Pandya's residence.

Pandya continues to express frustration with Pizza Hut, asserting that the brand singled him out for termination while retaining other franchisees with closed restaurants. He further contends that he urged the company to adopt third-party delivery services in 2019 to address a driver shortage and boost sluggish sales—a proposal he claims was rejected.

Pandya criticizes Pizza Hut for expending substantial resources on litigation against him, questioning the rationale behind such endeavors.

By the year 2020, Jay Pandya had parted ways with almost all his franchise restaurants, setting his sights on Boston Market and Corner Bakery.

Up Next:

Tuesday: Corner Bakery employees, who hoped for a savior, face an unexpected fate.