As economic pressures mount, some fast-food operators are expanding cautiously, while others are seeking bankruptcy protection to stay afloat. Among them is EYM Cafe of Texas LLC, which recently filed for Chapter 11 bankruptcy protection.
Highlights
- EYM Cafe of Texas LLC has filed for Chapter 11 bankruptcy protection.
- The petition was filed in the Texas Eastern Bankruptcy Court by EYM Cafe of Texas LLC.
- A recent legal battle contributed to the company’s financial decline and prompted the filing.
EYM Cafe of Texas LLC Filed for Chapter 11 Bankruptcy
According to PacerMonitor, on August 2, 2025, EYM Cafe of Texas LLC filed for Chapter 11 bankruptcy protection. The multi-brand franchisee cited a recent lawsuit as the primary factor behind its financial distress. The company has now turned to court to ensure continued services while it tries to restructure the organization.
The filing followed a court ruling that stripped EYM of its 15 Panera Bread locations in Houston. The stores were lost following a court judgment that ruled in favor of Panera. While the company remains eligible for Chapter 11 protection, it no longer retains rights to operate Panera-branded locations. EYM aims to use the bankruptcy process to restructure its finances and continue operations under court oversight.
EYM owner Eduardo Diaz’s history of filing for bankruptcy and fighting lawsuits is well known. His company’s other entities, including EYM Pizza, EYM Chicken, and EYM King, have a history of filing for bankruptcy.
Effects of the Panera LLC Lawsuit
In May, Panera LLC filed a lawsuit against EYM Cafe of Texas LLC. It was filed after the termination of the contract between the two companies. EYM allegedly continued operating Panera locations and using its trademarks without authorization. The judgment was ruled in favor of Panera.
It led to EYM losing control over 15 Panera stores in Houston, cutting off its income. The company hopes to recover through court-supervised restructuring following the legal dispute.
Imbalance between Assets and Liabilities
The Chapter 11 bankruptcy filing shows the company’s assets and liabilities. EYM Cafe of Texas LLC listed $50,000 in assets. While liabilities range between $10 million and $50 million, highlighting a major financial gap. This imbalance between the company’s assets and liabilities shows its inability to carry out business smoothly.
However, through Chapter 11 bankruptcy, the company hopes to find a balance once again. Though limited in scope, Chapter 11 may give the franchisee a chance to restructure and stabilize operations.
