Cerca Trova Restaurant Group, one of the largest operators of Outback Steakhouse franchises, has officially filed for Chapter 11 bankruptcy protection in Delaware. The San Diego-based company is currently grappling with a massive debt load of roughly 449 million dollars, leaving it unable to sustain its portfolio of 61 restaurants across several Western states. While the group operates in Arizona, Colorado, Nevada, and New Mexico, the bulk of its footprint is in California, where executives claim the local regulatory environment played a pivotal role in their downfall.
In court documents, CEO David Goronkin pointed toward a perfect storm of converging financial pressures that became unsustainable by 2026. He specifically highlighted California’s aggressive minimum wage hikes as a primary driver of the crisis. Although Outback is not subject to the specific twenty dollar hourly mandate reserved for fast food workers, it is still bound by the state’s general minimum wage increase to nearly seventeen dollars an hour. When combined with dwindling guest traffic and rising overhead, these payroll expenses pushed the company over the edge.
The struggle wasn’t just about wages; inflation hit every corner of the menu. According to bankruptcy filings, beef prices have climbed by as much as five percent annually since 2022, making those signature steaks far more expensive to produce. This trend coincides with a wider slump in casual dining across America, mirrored by recent high profile bankruptcies like Red Lobster and True Food Kitchen. Once a powerhouse with nearly one hundred locations in 2018, Cerca Trova saw its numbers dwindle steadily until this final collapse.
As part of the restructuring process, Bloomin Brands—the parent company of Outback Steakhouse—has stepped in as the lead bidder to buy back assets for about 26.3 million dollars. To ensure stores stay open during the legal proceedings, Bloomin Brands has provided millions in bridge financing. Company spokespeople were quick to clarify that this failure is isolated to this specific franchisee and does not reflect a systemic weakness within their overall corporate operations or liquidity.
