Houston’s iconic Turkey Leg Hut, known for its mouthwatering dishes and lengthy queues, made headlines once again as it filed for Chapter 11 bankruptcy on Tuesday morning in Texas Southern Bankruptcy Court. The move follows a recent court ruling ordering the restaurant to pay over $900,000 to a former business partner, adding to its already substantial legal woes.
According to the bankruptcy filing, Turkey Leg Hut, which has faced numerous controversies in recent years, reports liabilities exceeding $4.7 million to more than a dozen entities. The decision to file for bankruptcy came during a court hearing regarding an ongoing lawsuit involving the restaurant’s co-founders, Nakia Holmes and Lyndell Price, and a former business partner, Steve Rogers.
Rogers had sued Holmes and Price in 2023, alleging that they failed to pay him $1.5 million in restaurant shares owed to him. The lawsuit, a continuation of previous legal disputes dating back to July 2020, was set to determine the appointment of a court-appointed officer to oversee asset seizure to settle the outstanding debt.
However, with the bankruptcy filing, all collection efforts targeting Turkey Leg Hut, LLC, will come to a halt. Sean Roberts, an attorney representing Rogers, confirmed that a trustee will be tasked with arranging payments to satisfy the restaurant’s debts and liabilities.
The ongoing legal battles between Rogers, Holmes, and Price have further complicated Turkey Leg Hut’s financial situation. Previous disputes involved allegations of misusing restaurant funds and non-payment for buyout shares. Despite a settlement agreement reached in 2020, subsequent payment issues led to Rogers filing another lawsuit in 2023.
In addition to the debt owed to Rogers, Turkey Leg Hut faces nearly $2 million in state tax liabilities to the Texas Comptroller of Public Accounts.
The restaurant’s founders, Price and Holmes, have also been navigating personal challenges, including divorce proceedings and business conflicts. Despite these issues, Price emphasized that they are still business partners, even as he ventured into a new culinary venture with The Oyster Hut.
The bankruptcy filing comes less than three weeks after a fire ravaged Turkey Leg Hut’s business office, adding to the tumultuous period for the beloved Houston establishment.
