This has not been a good year for bagel emporium H & H Bagels. Last May owner Helmer Toro pleaded guilty to second degree grand larceny for pocketing $330,000 in payroll taxes and yesterday he went and filed for Chapter 11 bankruptcy protection to avoid being locked out of its New Jersey manufacturing facilities. Well, technically its parent company, Garden Operation Realty LP, did the filing.
In court papers Toro explained that the company had been hit doubly by the downturn and a series of expensive lawsuits. "One lawsuit in particular, with its landlord in Secaucus, N.J., resulted in the appointment of a rent receiver who recently won a court order of possession that could have resulted in the 'imminent padlocking' of the space the company leases there."
That padlocking was the impetus behind the filing, as Chapter 11 halts all pending litigation and protects the company from creditors. All of which gives Toro and co. time to try and turn their fortunes around. And considering the value of their brand alone, we'd be surprised if they don't make it work.
