A major Carl's Jr. operator in California has filed for bankruptcy, putting 65 restaurants at the center of the latest financial shakeup in the fast-food industry.
Industry trade publication QSR Magazine reports that Friendly Franchisees Corporation, which says it is the largest Carl’s Jr. franchisee in California, filed for Chapter 11 protection on April 2 along with several affiliated companies controlled by founder Harshad Dharod.
The filing covers a network of businesses tied to Dharod, including Sun Gir Incorporated, DFG Restaurants, and multiple holding and leasing companies. Court documents show each entity reported between zero and $50,000 in assets and liabilities.
The restaurants affected by the filing are spread across Northern and Southern California, though the company has not yet disclosed how many locations may ultimately close as the restructuring moves forward.
After immigrating from India to the United States to attend medical school, Dharod took a job at Jack in the Box to help cover expenses. He eventually became a franchise owner, building a portfolio of 19 Jack in the Box restaurants before selling those stores and purchasing the Carl’s Jr. locations in 2000.
Over the next two decades, Friendly Franchisees grew into one of the brand’s biggest operators in California.
Carl’s Jr. remains one of the largest burger chains in the country. The chain, owned by CKE Restaurants, has more than 1,050 locations nationwide and ranks as the 12th-largest burger brand in the U.S. by sales.
Like many major restaurant chains, however, nearly all of its locations are run by franchisees rather than the corporate parent itself, leaving individual operators especially vulnerable when costs rise or customer traffic slows.
The Carl’s Jr. filing is also part of a much larger pattern that has been unfolding throughout 2026. In recent weeks, a 136-unit Popeyes franchisee filed for Chapter 11 and began closing stores in Florida and Georgia after reporting roughly $130 million in debt.
Shortly thereafter, an Applebee's franchisee with more than 50 locations in the Southeast filed for bankruptcy after shutting down multiple restaurants in Georgia, Florida, and Alabama.
Other operators, including franchisees tied to Subway and Firehouse Subs, have also sought bankruptcy protection this year.
