McCain Mall last week sued David’s Burgers alleging the burgeoning central Arkansas burger chain failed to open a location in the North Little Rock mall as promised.
The mall is seeking $447,804.
It’s the second lawsuit against David’s Burgers over a lease in the last six months. A suit filed by Arvest Bank in January asked a court to declare that a lease between David’s Burgers for its location on South Bowman Road in Little Rock has been terminated, that the restaurant is now a month-to-month tenant and that Arvest has the power to end the tenancy by giving David’s Burgers 30 days’ notice.
Both lawsuits were filed in Pulaski County Circuit Court.
The suit by McCain Mall Co. Ltd. names as defendants David’s Burgers McCain Mall Inc. and owners Alan Bubbus and his wife, Jessica. The suit said that David’s Burgers’ lease began Feb. 12, 2016, and continues through 2025.
However, “Burgers failed to open for business at the McCain Mall location by February 12, 2016, and has not done so as of the date of this Complaint,” the suit said.
On Feb. 23 of this year, according to the lawsuit, McCain Mall demanded that the defendants “pay all past due rent, late charges, and future rent, totaling $447,804.22,” but “Such demands have been ignored.”
No formal response had yet been made to the McCain Mall lawsuit, which was filed Wednesday.
Asked about the lawsuits on Thursday, Bubbus said, “This ain’t Mayberry, is it?”
David’s Burgers didn’t locate at the property, he said, because “long story short, it doesn’t have a grease trap.”
Lease Dispute
The lawsuit by Arvest, which owns the property at 101 S. Bowman Road, was filed against David’s Burgers Bowman Co. The suit describes a months-long effort to negotiate a new lease or a short-term extension of the lease instead of an automatic renewal of the agreement, which was set to expire May 1, 2016.
The suit said that in a Feb. 18, 2016, email Bubbus gave notice he was vacating the property and so terminating the lease. On Feb. 26, 2016, Art McWilliams, vice president of Arvest Bank, sent Bubbus an email that referred to a potential offer to buy the building, according to the suit.
That same day, Bubbus responded saying the company still had three five-year options on the property and was still under contract, the Arvest suit said. “Since that time, Bubbus has refused to acknowledge that he effectively terminated the Lease via e-mail and has taken the position that the Lease was renewed automatically on May 1, 2016.”
In an answer and counterclaim filed in March, David’s Burgers denied Arvest’s claims and said that the company had asked Arvest to lower the rent and had told the bank it was interested in buying the property.
David’s Burgers also said that Arvest had indicated that CVS Pharmacies was interested in buying the building and that Arvest later accepted an offer by CVS for the building. (Pulaski County property records, however, show that Arvest is still the owner.)
David’s Burgers asked the court to find that Arvest had breached the lease agreement and that the restaurant company had been injured by the breach. It asked for the suit to be dismissed and to be awarded unspecified damages and attorney’s fees.
On Tuesday, the court filed a protective order in the Arvest case to keep private material claimed as confidential by the parties to the suit.
Bubbus told Arkansas Business on Thursday that he thought that he and Arvest were close to an agreement in its lawsuit. “I think everything’s going to get worked out on that,” Bubbus said.
“Things are going to happen. You’ve just got to say your prayers and do the best you can.”