Joe's Crab Shack abruptly closes 40 locations amid bankruptcy proceedings

By Allen Cone  |  Aug. 20, 2017 at 4:29 PM
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Aug. 20 (UPI) -- Joe's Crab Shack, the chain of beach-themed seafood restaurants, has closed at least 40 locations as the company undergoes a bankruptcy and sale.

Consumerist confirmed the location closings from readers and calls to the Crab Shack. Seven of the closings are in Texas, the state where the company's owner is based in Houston.

The companion brand, Brick House Tavern + Tap, closed two locations.

The company's website now lists 72 Joe's Crab Shacks and 23 Brick Houses.

Locations began closing without warning to employees or the public the week of Aug. 7.

A Brick House Tavern server says, "We got an email for a last minute conference call Tuesday morning [Aug. 8] that lasted less than five minutes stating they would not be opening the restaurant, effective immediately, and it is permanently closed."

A worker in Indiana told Consumerist they heard that the parent company "only wants 60 Joe's Crab Shack locations to remain open."

Joe's Crab Shack owner, Ignite Restaurant Group, filed for Chapter 11 bankruptcy protection on June 6 in Houston.

Landry's -- whose brands are Bubba Gump Shrimp Co., Morton's The Steakhouse and Rainforest Cafe -- won a bankruptcy auction in August for $57 million for just the Crab Shack brand. A federal judge approved the deal.

In 1994, Landry's founder Tilman Fertitta bought the original Joe's Crab Shack, which opened in 1991, and spun off the Joe's and Brick House brands to J.H. Whitney & Co. in 2006. It went public in 2009 and became Ignite Restaurant Group.

Earlier, Ignite said it had entered a $60 million sale agreement with KRG Acquisitions Co. LLC, an affiliate of San Diego-based private equity company Kelly Cos., for both brands. At the time, Ignite said all 112 Joe's Crab Shack and all 25 Brick House Tavern restaurants would stay open. But those plans fell through.

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