Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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UPDATED: Oct 9, 2012

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It comes to the surprise of few that one of Boston’s most popular pizza chains, Upper Crust, is filing for Chapter 11 bankruptcy protection. With accusations of misused funds, widespread complaints from unpaid employees, and even some federal investigations, the once-very successful company now finds itself facing a mountain of legal and financial problems.  

The Boston Globe reports that the company, which began in 2001, owes $3.4 million in debt, and defaulted on a loan in September. Some events leading to their current financial troubles include being ordered by the government to pay employees nearly $350,000 in overtime in 2009, and then a class action lawsuit in 2010 filed by former Upper Crust workers. In addition, ZVI Construction Co. brought a lawsuit against Upper Crust to recover roughly $700,000 in outstanding payments owed for construction work on the stores. 

Upper Crust, which prides itself on numerous awards and local praise, has been under investigations by the U.S. Department of Labor throughout these lawsuits, which has “distracted management” and “imposed significant costs” on the company, said Dan Hurley, chief financial officer to the chain, according to The Boston Globe

The company’s move to file Chapter 11 as a last resort will come with a new financial reorganization plan and an attempt to find a feasible approach to paying its many creditors. But once out of bankruptcy, management will have to employ better spending practices in order to get back on track. 

To learn what bankruptcy means for a business like Upper Crust, read Why Would a Company Choose to File Chapter 11?