A FAT Brands investor filed a lawsuit against the company in June, one month after Andy Wiederhorn — former CEO and current chairman of FAT Brands — was indicted by the U.S. Securities and Exchange Commission on multiple counts of misappropriation of company funds, wire fraud, false statements, and more, to which the accused parties have pled not guilty.
Former FAT Brands investor Mitchell Kates filed the lawsuit with the California Central District Court on June 7, alleging that Wiederhorn and other defendants named in the criminal case, “made materially false and/or misleading statements and/or failed to disclose” that he had allegedly received “improper payments from the company” and “exposed FAT Brands to criminal liability.” The defendants' statements were therefore deemed by the plaintiff to be, "materially false and misleading and/or lacked a reasonable basis at all times."
The original SEC complaint accused Wiederhorn of spending $27 million of company income on “personal expenses including private jets, first class airfare, luxury vacations, his rent and mortgage payments, shopping, and jewelry,” at one point stripping FAT Brands of 40% of its revenue, and “often leaving the company with insufficient cash to pay its own bills.”
The lawsuit — which names FAT Brands, Andy Wiederhorn, and current FAT Brands CEOs Kenneth Kuick and Robert Rosen — seeks class action status and recovery of losses for FAT Brands shareholders during the time of the actions named in the indictment, from Sept. 2018 through Jan. 2021, under the Crime Victim Rights Act.
Potential defendants in the case are encouraged to contact the U.S. Department of Justice at [email protected]. The FAT Brands criminal trial is expected to begin on Oct. 28, 2025, in the U.S. District Court in Los Angeles.
Contact Joanna at [email protected]