A federal judge has thrown out a bankruptcy case filed last year by the manager of the Penguin Drive-In restaurant, after the eatery failed to pay court-ordered fees and file financial documents.
The ruling last month by U.S. Bankruptcy Court Judge J. Craig Whitley adds a chapter to the tumultuous recent history of the Penguin, a Charlotte landmark dating to the 1950s that has been featured on national TV and in movies.
The eatery, at 1921 Commonwealth Ave. in the Plaza Midwood neighborhood, has changed hands in recent years amid financial setbacks and management struggles.
The current landlord, 1921 Commonwealth Ave. Holdings LLC, sued the restaurant’s management last year, accusing the eatery of defaulting on its lease and a $17,763 loan.
Never miss a local story.
The lawsuit said when the restaurant failed to pay its August rent, Commonwealth Ave. Holdings demanded payment in full of the remainder of the loan. Penguin paid the August rent but didn’t pay the note in full, according to court papers.
Lisa Ballentine, whose father, Jim Ballentine, opened the Penguin in the 1950s as an ice cream shop, filed for bankruptcy protection in November.
She was listed as the restaurant’s manager, and the responsible debtor, in separate Chapter 11 bankruptcy filings for Penguin Holdings Inc. and Penguin Drive-In LLC.
Both listed assets of less than $50,000.
Penguin Holdings had estimated liabilities of less than $50,000, while Penguin Drive-In reported estimated liabilities of $100,000 to $500,000.
Both companies at the time listed 1921 Commonwealth Ave. Holdings among their largest creditors, with each showing a claim of $22,123 outstanding.
But in an April 16 order, Whitley dismissed the bankruptcy case involving Penguin Drive-In, saying the restaurant hadn’t paid court-ordered quarterly fees or filed monthly status reports and submitted its 2012 tax return.
The case involving Penguin Holdings remains active, according to the court docket. According to a reorganization plan filed in March, Penguin Holdings is a guarantor of Penguin Drive-In’s loan and lease agreement with Commonwealth Ave. Holdings.
Reached Monday by phone, Lisa Ballentine had little comment. Asked whether the Penguin will continue operating, she replied: “Yes it will, but I’ll probably let my attorney speak with you about that. He’ll give you a call.”
She then hung up. Charlotte lawyers Travis Moon and Richard Wright, listed on the court docket as her attorneys, couldn’t immediately be reached.
The Penguin, known for its burgers and fried pickles, has appeared on the Food Network’s “Diners, Drive-Ins and Dives,” and recently was featured in the hit movie “Bad Grandpa.”
Staff researcher Maria David contributed.