A beloved retailer is reviving itself from the grave. Popular coffee chain Foxtrot is making a comeback after it suddenly closed all of its stores in April, causing backlash among its blindsided employees, when its parent company Outfox Hospitality announced plans to file for Chapter 7 bankruptcy.
Foxtrot, which had stores in Chicago, Texas, and Washington, D.C., announced that it is reopening about a dozen of its stores in existing locations. Two of them are reopening this summer in Chicago.
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The move from the company comes after David Magruder, managing partner of Further Point Enterprises, won a bid to purchase Foxtrot’s assets on May 10. Mike LaVitola, who founded Foxtrot, will be working with him to revive the company’s losses.
“It’s a totally new company starting from scratch, but (we) have the Foxtrot name and the (intellectual property) and a bunch of our locations,” LaVitola told Crain's Chicago Business. “We’re like a new startup again.”
LaVitola also said in the interview with Crain's that the company will be opening about one or two new stores a year and is opting to not reopen its locations in Washington, D.C., as he is focused on reopening stores that previously brought in the most profits.
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“We wanted to set ourselves up for success and really doing that in the markets we know best, which are our home markets in Chicago and Texas,” said LaVitola. “There’s still a lot of growth ahead. . . .We’re still very ambitious and have big goals, but we can now do it in a more measured way.”
The announcement comes after Foxtrot shocked its employees on April 23 when it shut down its stores nationwide, reportedly giving its workers little to no notice of the move ahead of time.
Most notably, two Foxtrot employees went viral on TikTok after they posted a video of the moment they found out they were being laid off during their shift. In the video, they claimed that they were given a two-hour notice to close the store permanently, forcing them to kick out customers mid-day.
@sadkiwigirl found out 2 hours before that our company was closing nationwide!!! anyone know how to file for unemployment??? if you're able to help out here's my venmo: julia-harlos 🫶🏻❤️ #fyp #capitalism #barista #baristalife #foxtrotmarket
♬ Frolic (Theme from "Curb Your Enthusiasm" TV Show) - Luciano Michelini
Shortly after the chaos, Foxtrot released a statement on Instagram apologizing for the abrupt move.
“The decision has not been made lightly, and we understand the impact that it will have on you, our loyal customers, as well as our dedicated team members,” wrote the company in the statement. “... We understand that this news may come as a shock, and we apologize for any inconvenience it may cause.”
A class-action lawsuit was later filed against Foxtrot by its former employees for allegedly violating the Worker Adjustment and Retraining Notification Act (WARN Act), which is a labor law that requires a company to give employees at least a 60 days written notice of planned closings and mass layoffs. The lawsuit also accuses the company of failing to pay its laid off employees severance and other employee benefits.
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In the interview with Crain’s, LaVitola claims that he is still trying to piece together how the company was forced to file for bankruptcy shortly after merging with Dom’s Kitchen & Market late last year, which also had to shut down its stores. At the time of the closures, LaVitola claims he was an adviser at the company and said that he wasn’t aware of the company’s financial status.
“I still have my own questions as to what happened,” said LaVitola. “I think everyone was really surprised that a brand that was this strong with customers and this strong with vendors . . . could just fold up.”
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