Petition with over 220K signatures urges Ruth's Chris to return $20 million federal loan
It's no secret that many restaurants have been struggling to keep their doors open since the coronavirus outbreak forced many to shut down or switch to takeout only. Ruth's Chris Steak House, a chain of over 100 steakhouses across the United States, Canada and Mexico, was one of the restaurants who sought help to keep their payroll going through the Paycheck Protection Program (PPP). But now, the company is under fire for accepting $20 million total in stimulus loans, as critics say the money was not really meant for larger restaurant chains.
Ruth's Hospitality Group Inc, which owns the Ruth's Chris Steak House brand, took $10 million in forgivable loans for each of its two subsidiaries, for a total of $20 million, from the $349 billion fund, which is part of the CARES Act to help small business owners during the coronavirus pandemic. The fund quickly ran out before many small restaurants could receive anything. Now, a petition on Change.org is asking Ruth's Chris to return the money.
"Tell Ruth's Chris Steak House 'Return the money now! You will be shamed forever if you do not. People will not forget,'" reads the petition, which, as of Wednesday afternoon, had over 225,000 signatures (out of the 300,000 goal). The petitioners argue that the funds were intended for what they call "true small businesses." Although companies like Ruth's Chris Steak House, Potbelly Sandwich Shops and Shake Shack are chains, they all have fewer than 500 employees at each location, which allowed them to apply for the loans. Many critics believe the companies used this as a loophole to secure funds while little mom-and-pop restaurants were left empty-handed.
On Monday, Shake Shack founder Danny Meyer and CEO Randy Garutti announced they were returning the 10 million in loans they had received from the program.
"With the country facing a prospective permanent loss of restaurants up and down the food chain, the bill arrived just in the nick of time," read Shake Shack's statement, posted on LinkedIn. "The onus was placed on each business to figure out how, when, or even if to apply. The 'PPP' came with no user manual and it was extremely confusing."
Food
Shake Shack said they were "able to access the additional capital we needed to ensure our long term stability through an equity transaction in the public markets" and the fast casual burger chain was applauded for its decision to put the money back on the table for the "restaurants who need it most."
An update from the initiator of the petition was posted to Change.org on Wednesday. "News through the grapevine says all publicly traded companies will have to give the money back," read the statement, which urged people to "keep spreading the word."
So far, Ruth's Chris has not made any statement as to whether they plan to hold onto the loans. A representative from Ruth's Hospitality Group Inc. did not immediately return a request for comment.