Ruby Tuesday Operations Seeks Declaratory Relief and Damages Concerning its Parking Rights, Files Action Against Lenox Outdoor & Advertising, LLC
August 19, 2021, District of Delaware – Plaintiff Ruby Tuesday Operations LLC (RTO), successor-in-interest to Ruby Tuesday, Inc. (“RTI”) recently filed a complaint against Defendant Lenox Outdoor & Advertising, LLC seeking declaratory relief, damages, and attorneys’ fees, objecting to the cure claim under Rules 3007(b) and 7001 of the Federal Rules of Bankruptcy Procedure and responding to the cure objection.
RTO and its affiliates develop, operate, and franchise casual dining restaurants under the Ruby Tuesday® brand. Lenox is the purported current fee owner of the restaurant property and current lessor under the lease. Allegedly, in negotiating the lease, RTI bargained for a perpetual, uninterrupted right to utilize parking for its customers, employees, and invitees in a parking lot adjacent to the restaurant property along Virginia Avenue.
The Trustee argues that the original lessor and all successor lessors, including Lenox, allegedly breached and defaulted on their covenants, obligations, representations, and warranties under the lease, and in doing so, they purportedly jeopardized RTI’s parking rights and, in turn, its ability to successfully continue operations at the restaurant. RTI therefore, brought this action to protect its parking rights. RTI (now RTO) alleges that it has been forced to pay not only for the parking rights it was promised under the lease at no additional cost but for the expenses of ensuring those rights are not terminated or otherwise infringed. RTO now requests that the Court enter judgment against Lenox and award money damages under section 542 of the Bankruptcy Code.