One of the Mediterranean cuisine restaurants in San Diego, California, has filed for bankruptcy. Zytoun Gourmet Mediterranean, Inc. has made this move due to a notable difference between its assets and liabilities.
The Chapter 11 filing indicates the restaurant is seeking to reorganize its finances. As the proceedings begin, the restaurant is expected to continue serving patrons.
Zytoun Gourmet Mediterranean, Inc. Enters Bankruptcy
The restaurant business moved to the bankruptcy court on June 19, 2026. Case filings show that it qualified as a small business debtor. The filing shows the company intends to proceed under Chapter 11, Subchapter V.
These types of filings typically allow small businesses like the San Diego restaurant to complete their bankruptcy requirements in a faster and cost-efficient manner.
The restaurant is known for serving a range of Mediterranean dishes at its waterfront setting.
The petition also references a prior bankruptcy filing involving Alexco-USA, Inc., identified in court records as a second San Diego-area restaurant. Case records show that the restaurant made its filing on April 30 this year in the U.S. Bankruptcy Court for the Southern District of California.
Additional details are available on PACER under case number 26-01810-CL11.
Filings Made So Far
Case records show that Zytoun Gourmet Mediterranean, Inc. submitted a summary of assets and liabilities. According to the filing, the debtor reported approximately $164,811 in assets and more than $1 million in liabilities.
The filing also includes a list of the restaurant’s largest unsecured creditors. These include the Internal Revenue Service, Forward Finance, LLC, Ford Global, LLC, ARF Financial, LLC, and others.
Court filings indicate that funds will be available for distribution to the unsecured creditors.
The restaurant business further listed a statement of financial affairs, which shows the changes in its gross revenue from 2025 to the filing date. According to the petition, company president Hamdi Abukhalaf is the restaurant’s sole owner.
Case filings add that attorney Steven E. Cowen, Esq. of S.E. Cowen Law is the legal counsel of the debtor.
A summary of the Chapter 11 petition is shared here:
- Filing Date: June 19, 2026
- Court and Jurisdiction: U.S. Bankruptcy Court for the Southern District of California
- Type of Filing: Active, Voluntary Petition
- Chapter: 11, Subchapter V
- Case Number: 26-02620
- Estimated Assets: Between $100,001 and $500,000
- Estimated Liabilities: Between $1,000,001 and $10 million
- Estimated Creditors: 1-49
- Reason for Filing: Restructure business under court supervision
The Restaurant Industry Faces a Series of Bankruptcies
The past months have been a turbulent ride for the nationwide restaurant operators who have pursued bankruptcy proceedings amid financial troubles.
A Mexican dining chain based in Scottsdale recently made a Chapter 11 filing to reorganize its finances. The petition on June 15 showed that Four Fingers LLC’s liabilities outweighed its assets and that it is proceeding under Subchapter V. The company, which operates as Salt and Lime Modern Mexican Grill, also serves across Phoenix and Cave Creek.
On March 11, 2026, a restaurant in North Hollywood pursued a bankruptcy process. Its Chapter 11 petition showed that Hayats Kitchen, Inc. had met the requirements of a small business debtor. The casual eatery offers a variety of Lebanese dishes.
Known for its range of American comfort food, Firehouse Grill Inc. entered bankruptcy on January 20, 2026. Case filings showed a gap between its assets and liabilities. The bar & grill restaurant from Evanston made this move after its owner acquired seafood staple Bluestone in 2022.
Zytoun Gourmet Mediterranean, Inc.’s filing reflects consistent pressures in the restaurant sector, where small and mid-sized operators are increasingly turning to restructuring. Despite the filing, the restaurant is expected to remain open during the proceedings.
