Iconic CA Burger Joint To Close 10 Restaurants And Sell Dozens More, Blaming $20 Minimum Wage

One of California's largest Carl’s Jr. franchise operators is trying to close and sell the 59 locations he operates in the state amid bankruptcy proceedings, according to reports.

Friendly Franchisees Corporation filed for Chapter 11 bankruptcy protection in April along with several affiliated entities tied to founder Harshad Dharod. Together, the companies operate 59 Carl’s Jr. locations across the state and employ roughly 1,000 workers, Fast Company reported.

Court filings show the company is seeking to reject leases at 10 underperforming restaurants. Dharod is trying to find a buyer for the remainder of his locations, the Los Angeles Times reported on Saturday. It's not clear how many will stay open.

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A spokesperson for Carl’s Jr. said the company is aware of Dharod’s decision to sell.

“This situation is specific to this individual franchisee’s financial and business circumstances,” the spokesperson said. “This has no impact on the operations of any other Carl’s Jr. locations.”

The sale of Dharod's locations is being overseen by National Franchise Sales; a spokesperson for the company told the Times it already has interest from prospective buyers.

Citing court documents, Fast Company identified these 10 locations as ones that may close:

• 19400 Ventura Blvd, Tarzana
• 165 E. Duarte Road, Arcadia
• 573 N. Azusa Ave, Covina
• 140 E. Foothill Blvd., Pomona
• 16815 Devonshire St., Granada Hills
• 18756 Sherman Way, Reseda
• 1000 Farmers Lane, Santa Rosa
• 141 S. Diamond Bar Blvd., Diamond Bar
• 485 Rosemead Blvd., Pasadena
• 505 W. Las Tunas Dr., San Gabriel

In bankruptcy filings, the franchisee said the locations — some of which have operated for decades — have struggled financially since California’s $20 minimum wage for fast-food workers took effect in April 2024.

• Related: CA's $20 Minimum Wage For Fast-Food Workers May Have 'Consequences': Report

Sun Gir Inc., the lead debtor in the case, said the restaurants have faced rising operating costs, increased competition and weakening sales, leaving some locations operating at steep losses.

The company said its restaurants collectively generate more than $6 million in monthly revenue but have been losing more than $600,000 per month this year, Restaurant Dive reported.

One Arcadia location alone reportedly lost more than $400,000 over a two-year period, Fast Company reported.

The bankruptcy reflects broader challenges facing Carl’s Jr. in California, where the chain has already seen declining store counts and weakening sales.

Carl’s Jr. operated 588 California locations in 2025, down from 613 in 2023. Consumer spending at the chain also reportedly fell 4% last year, MassLive reported.