Crimson Lobster’s On a regular basis Infinite Shrimp deal appeared too good to be true. In June of 2023, the promotion was became a everlasting menu merchandise, providing prospects limitless servings of shrimp for simply $20. The transfer was a head-scratcher: How may a deal like that presumably be worthwhile? Seems, it wasn’t—and a brand new lawsuit claims that will have been on objective.
The Crimson Lobster GUC Belief, a liquidation belief fashioned when Crimson Lobster filed for chapter in 2024, is suing former majority stakeholder Thai Union Group, a Thai seafood firm. The lawsuit alleges that Thai Union handled Crimson Lobster “as little greater than a distribution arm for its personal merchandise, milking no matter worth it may from Crimson Lobster, particularly because the Firm grew to become bancrupt.”
That included limiting Crimson Lobster’s selection of seafood suppliers, interfering in its management, and pushing for the Infinite Shrimp deal that led to the corporate’s chapter, based on the lawsuit.
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‘A automobile crash’: How limitless shrimp doomed Crimson Lobster
The lawsuit’s complaints begin with the appointment of Thai Union worker and Crimson Lobster Grasp Holdings GP Board member Paul Kenny as interim CEO. Kenny and Thai Union allegedly drove the previous CEO to resign, then pushed Crimson Lobster to buy huge quantities of “overpriced Thai Union Shrimp,” even within the face of insolvency.
Then got here the On a regular basis $20 Final Infinite Shrimp deal, which the lawsuit calls “a marketing campaign to squeeze out each drop of worth” from Crimson Lobster. The lawsuit claims that regardless of firm leaders being warned that the deal would result in important losses, they moved ahead with the deal, additionally banning one in all Thai Union’s competing seafood suppliers. “Overpriced” components and the deal’s low cost price ticket allegedly led on to Crimson Lobster’s chapter submitting.
The promotion “turned a profitable legacy Crimson Lobster technique to drive site visitors into its eating places right into a automobile crash,” reads the grievance. Even a value hike from $20 to $25 couldn’t salvage the deal: Crimson Lobster nonetheless reported a report lack of $12.5 million within the fourth quarter of 2023.
Thai Union exited Crimson Lobster in early 2024, reporting a $19 million loss from the corporate throughout the primary 9 months of 2023.
Neither Crimson Lobster nor Thai Union Group have replied to Quick Firm’s request for remark.
Crimson Lobster’s model rehab
Since its promotion-gone-wrong in 2023 and chapter in 2024, Crimson Lobster has clawed its means again, thanks in no small half to a cultural rebrand from new CEO Damola Adamolekun.
Adamolekun took the helm of Crimson Lobster in August of 2024, becoming the youngest CEO in the company’s history at just 35 years old. He struck the Final Infinite Shrimp deal from the restaurant’s everlasting menu, joking, “I understand how to do math” (and thus recognizing the promotion’s lack of enterprise sense).
Below Adamolekun’s management, Crimson Lobster has bounced again from chapter, even bringing Infinite Shrimp again to its menu this April for a restricted time solely, discovering a center floor between fan demand and the model’s earlier missteps.
“That is about placing our company first and bringing again one thing they honestly love,” Adamolekun mentioned in a press launch on the time.
“Infinite Shrimp has been part of Crimson Lobster’s legacy for 20 years and our company have by no means stopped asking for it,” he continued. “We’re excited to convey it again, for a restricted time, in a means that works for our enterprise right this moment and honors what made it particular from the start. As a result of when our followers discuss, we hear.”
