This Beloved Burger Chain Is Forced to Change Its Name, Judge Rules
Beloved plant-based fast-food concept By Chloe announced it was filing for Chapter 11 bankruptcy in December. And while the company seems to have reached a sales agreement with a new owner, the burger chain will have to give up one crucial asset—its name.
According to Restaurant Business, By Chloe's parent company BC Hospitality Group has agreed to sell the chain to a group of investors for $333,000, who will buy the company's assets out of bankruptcy as well as assume liabilities. The deal is pending court approval.
However, a judge in a separate trademark hearing ruled that BC Hospitality doesn't have the right to sell By Chloe's name without agreement from its original founding chef Chloe Coscarelli, who the brand was named after.
Coscarelli has filed several lawsuits against one of the largest stakeholders ESquared since leaving the business in 2017, one of which was over the continuing use of her name. According to the Wall Street Journal, the brand's name itself is one of the most valuable assets of the bankruptcy estate.
Should the deal go forward, the new owners will have six months to come up with a new name for the vegan chain and to remove the By Chloe name from all "restaurants, supplies, digital media and all other assets," according to court documents.
In its bankruptcy filing, which cited the effects of the ongoing COVID-19 pandemic, the New York-based chain revealed that monthly revenue had decreased by 67% since February, forcing the closures of 3 of its 14 locations.
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