Want to learn how to start a successful business, use it as a personal piggy bank and rob creditors and even your own employees & franchise owners blind? Upper Crust, the Boston-based pizza chain, is your blueprint:
[Bankruptcy trustee Mark] DeGiacomo plans to auction off leases for all 10 shuttered Upper Crust stores that are part of the bankruptcy, as well as related assets at each location. Details of the auction are still being worked out, but the trustee plans to file a motion to sell early next week.
Last week, DeGiacomo closed the bankrupt stores and laid off 140 workers because the gourmet pizza business had just four days of supplies and only $14,000 in cash after the executives paid themselves a month’s salary in advance. [...]
Upper Crust, founded in Beacon Hill in 2001, filed for bankruptcy protection in October after defaulting on its loan. In court papers, the company said it owes at least $3.4 million to creditors, and the US Department of Labor said the business owes another $850,000 in back wages and damages for violating minimum wage and overtime laws.
Yes, despite being under legal order to pay its employees nearly a million dollars, executives were still able to steal money from the company without giving workers a dime.
But wait! Before you start accusing the US Bankruptcy Court & Labor Department of being toothless dupes, the story gets even better!
And by “better,” I mean the people running Upper Crust could not possibly be better at being evil robber barons!
In addition to dealing with the fallout from the parent company’s bankruptcy, [Newburyport & Portsmouth franchise owner Mark] Tramontana said his franchises have also been coping with the fact that the company sold thousands of discount vouchers on Groupon without franchisees’ knowledge and kept the proceeds before filing for bankruptcy.
Despite years of unenforced court orders & failed repayment plans, I can find no talk of throwing Upper Crust founder Jordan Tobins or the chain’s current executives in jail.
If I started mugging people on the street to the tune of $850,000, the Herald would give me my own nickname (I’m thinking The Treehugging Mugger) and when they caught me, they’d lock me up and throw away the key. But as striker57 wrote here at BMG two years ago when news first broke that executives were stealing from employees, Upper Crust executives get to live the high life while bankruptcy courts spend years trying (and mostly failing) to sort things out.
It’s the same model Hostess executives used: Loot the company and when the money runs out, file for bankruptcy & leave workers holding the tab.
It’s legalized robbery, and if Massachusetts law enforcement doesn’t want to do anything about it, it may be time to bring back torches & pitchforks.