Raising Cane’s is suing Hobart shopping center after being told they can’t sell chicken

HOBART, Ind. — Raising Cane’s, a restaurant known exclusively for its chicken fingers, is suing a northwest Indiana mall after being told — after eight months and more than a million dollars in construction — that it would be barred from selling chicken fingers. due to a long-standing, undisclosed deal with McDonald’s.

The lawsuit, filed by Raising Cane’s in federal court in Texas, alleges that Crossings of Hobart and property owner Schottenstein Property Group tricked the popular chicken finger chain into signing a 15-year lease that equated to more than $2 million in rent, but never disclosed , that McDonald’s has exclusive rights to sell chicken at a mall located next to Southlake Mall in Hobart.

Raising Cane’s as part of it push into Indianaplanned to build a double drive-thru restaurant on the site of the former TGI Fridays, located on US 30 across from the Best Buy across from the mall.

“Despite the fact that the entire business model of Raising Cane’s Chicken Fingers is based on the sale of chicken fingers, the defendants failed to disclose this issue prior to the execution of the lease,” the lawsuit states.

The lawsuit alleges that not only did the defendants tell Raising Cane’s that they did not have exclusive rights that would affect their restaurant, but that the defendants even tried to sell Raising Cane’s exclusive rights to sell boneless chicken in the mall, “knowing that McDonald’s ․ has already been sold with such a right.’

“Incredibly, Defendants did not tell Raising Cane’s that they would not be able to sell their chicken fingers in the mall nearly eight months after Raising Cane’s had spent nearly a year and over a million dollars developing their new restaurant,” the lawsuit said. lawsuit. said.

The lawsuit says that the exclusive rights were granted to McDonald’s in 1994 by the previous owners of the property. It goes on to say that Crossings of Hobart not only knew about this exclusive deal, but also tried to “conceal its misconduct”.

According to the lawsuit, a little more than a week after construction began on Raising Cane’s on the site of the former TGI Fridays, Crossings of Hobart sent a letter to McDonald’s asking it to waive its exclusive rights so the mall could get a lease from Chipotle.

McDonald’s reportedly denied the request.

The suit says that in McDonald’s letter, the Golden Arched fast-food restaurant chain also reminded property owners that the proposed Raising Cane’s Chicken Fingers would violate the terms of the chicken’s exclusive rights and ordered the property owner to “immediately cease any such offer to sell chicken.”

“Despite McDonald’s strong position, the defendants did not say anything to Raising Cane’s,” the lawsuit states. “Instead, the defendants were sidelined as Raising Cane continued to incur more than a million dollars in development costs.”

The lawsuit goes on to say that Crossings of Hobart tried again to get McDonald’s to give up exclusive rights to the chicken a few days later, but McDonald’s again urged the property owners to stop construction on Raising Cane.

According to the lawsuit, the defendants didn’t assert their exclusive rights until March 22, 2022, six weeks after they transferred the property to Raising Cane’s and “silently watched as Raising Cane’s spent significant capital to demolish the building to make way for the restaurant.” . Defendants knew they would be implicated by the Exclusive Use Clause.”

Raising Cane’s said that if the company had known about this exclusive deal, they would never have signed the lease.

The lawsuit accuses the defendants of multiple counts of fraud and seeks millions of dollars in development costs and lost profits along with voiding the lease.