Financial problems force closing of seafood eateries

2011-09-15T00:00:00Z Financial problems force closing of seafood eateriesPhil Villarreal Arizona Daily Star Arizona Daily Star
September 15, 2011 12:00 am  • 

Something fishy went on at Tucson's former Long John Silver's joints.

In June, Southwest Seafood Shoppes LLC - which operated the area's five franchisee Long John Silver's and is owned by John Willingham - rebranded the restaurants as Overboard Seafood & Grill after severing ties with the mother ship and filing for bankruptcy.

Long John Silver's sued Southwest Seafood Shoppes in U.S. Bankruptcy Court. According to the lawsuit, Overboard broke its franchise agreement by offering a menu with battered seafood in a fast-food format and failing to strip all the locations of Long John Silver's branding.

The case was dismissed Sept. 7 because Southwest Seafood Shoppes is no longer operating.

"There have been numerous complaints to Long John Silver's reporting the poor quality of the food, service and facilities because the customers continue to believe that the restaurants are authorized Long John Silver's restaurants," the lawsuit said.

Long John Silver's sought damages for trademark infringement, an accounting of the company's profits, payment for using its trademarks after the franchise agreement was terminated, legal fees and an injunction that would have forced Southwest Seafood Shoppes to remove Long John Silver's branding and stop it from selling a competing product.

An attorney for Long John Silver's did not return phone calls seeking comment.

In its May Chapter 11 bankruptcy filing, Southwest Seafood Shoppes listed $100,600 in assets and more than $1.2 million in liabilities.

The restaurants were at 4105 N. Oracle Road, 7120 E. Broadway, 3700 S. Sixth Ave., 4640 W. Ina Road and 4030 E. 22nd St. All have closed, and the Oracle location had an eviction notice posted on its door.

Willingham started as a cook at Long John Silver's 38 years ago in Dallas. He moved to Tucson in 1989 to run the local operations for the company and bought the five restaurants in 1998.

In June, he told the Star: "With Long John Silver's, we were constricted with what we could do. We needed to be a little more hip, a little more up-to-date and offer our customers a lot more than just fried products."

In its brief period of operation, Overboard offered grilled seafood and wraps in addition to fried food.

Willingham's lawyer, Eric Sparks, said Southwest Seafood Shoppes laid off 98 employees in July.

According to attorney Greg Good, who represents Long Family Trust, owner of the Oracle location, a new entity called Overboard #1 LLC, managed by Willingham's son, J.P. Willingham III, seemingly took over the lease for Southwest Seafood Shoppes in late May. That was after Southwest Seafood Shoppes had been in breach of the lease "for some time," but was unable to come to terms for a new lease agreement, Good said. Long locked Overboard out in late July.

Calls to landlords at the other Long John Silver's/Overboard locations were not returned.

Sparks said he represents neither Overboard nor J.P. Willingham III. He said Southwest Seafood Shoppes emerged from Chapter 11 bankruptcy after being relieved of its leases and franchise agreements and has ceased operations.

Sparks said Southwest Seafood Shoppes suffered financial difficulties because Long John Silver's scaled back its local advertising budget and increased its franchise fees by $700,000 over two years.

Good said his client has "done everything they could to try to accommodate Long John Silver's. There seemed to be a number of difficulties inside of those businesses."

Contact reporter Phil Villarreal at pvillarreal@azstarnet.com or 573-4130.

Copyright 2014 Arizona Daily Star. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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