Turkey Leg Hut, a popular restaurant that's become a staple in Houston's Third Ward community, has filed for Chapter 11 bankruptcy.
According to court records, the restaurant owes nearly $5 million in debt to 19 creditors. A list of creditors owed includes American Express, City of Houston - Water, the IRS and the Small Business Administration.
The bankruptcy news comes nearly two weeks after co-owner Lyndell 'Lynn' Price was ordered to pay his former business partner Steve Rogers nearly a million dollars. Rogers was also listed as one of the creditors in the bankruptcy filing.
The restaurant that's known for its massive, stuffed turkey legs and long lines of customers has seen its fair share of financial drama over the years.
In 2018, a lawsuit was filed against co-owner Nakia Price after she allegedly failed to pay rent after assuming a lease for Turkey Leg Hut. This civil case is still ongoing, according to court records.
In 2022, US Foods, based in Delaware, filed a lawsuit in the U.S. District Court in Illinois, alleging Turkey Leg Hut owed $85,106.17, but with the interest rate and attorney’s fees, the total amounted to $1,288,583.12 as of the court filing.
When we reached out to Turkey Leg Hut about that lawsuit, Nakia said she was not aware and said the math wasn't adding up.
US Foods was not listed in the bankruptcy filing. It's unknown if this lawsuit was settled.
In March of this year, a fire broke out inside the business office of Turkey Leg Hut. In a social media post, Nakia said she's grateful the restaurant didn't burn.
"Lord, what are you preparing me for," she posted on Instagram at the time.
Nakia built Turkey Leg Hut with her husband, Price. The two recently filed for divorce, according to court records.
Despite the financial woes, the two have seen huge success in the business. On any given weekend, a line of customers -- some local, some visitors -- is wrapped around the restaurant, waiting to dine on the popular turkey legs.
What is Chapter 11 bankruptcy?
According to the United States Courts, a case filed under Chapter 11 of the United States Bankruptcy Code is frequently referred to as a "reorganization" bankruptcy. Usually, the debtor may continue to operate its business, and may, with court approval, borrow new money. A plan of reorganization is proposed and creditors whose rights are affected may vote on the plan. The court may confirm the plan if it gets the required votes and satisfies certain legal requirements.