Penguin Drive-In files for Chapter 11 before eviction hearing

CHARLOTTE, NC (WBTV) - Amid weeks of controversy, the manager of a popular Charlotte restaurant filed a voluntary Chapter 11 petition Thursday morning. Sources say Lisa Ballentine, the manager of The Penguin Drive-In, owes approximately $400,000 to various creditors and is unable to pay.

All of this comes after what was a mysterious ten-day closure that sparked rumors on social media.

Ballentine released a statement on August 4 explaining the closure saying in part "after an unfortunate and tragic death in the family of one of our staff members, we as a staff decided it was best for The Penguin Drive-In to close for seven days this past week. We are a small staff, and our staff is like family."

"When one of our family members is faced with what happened recently, it affects all of us," she continued. "We felt it was in the best interest of the staff to take a pause."

Ballentine said the restaurant would reopen, but in fact did not by the date she initially stated.

There was a notice from Piedmont Natural Gas found on the front door of the restaurant on August 6. WBTV asked PNG if the gas had been cut off to the building, but officials cited federal law for not being able to answer questions about customer-specific accounts.

A phone number listed for the restaurant appeared to be disconnected.

WBTV then obtained eviction papers that were filed on the same day that Ballentine made the statement about the closure.

1921 Commonwealth Ave. Holdings, LLC., the landlord of the property, filed the eviction papers on Monday, August 4, stating that the restaurant owed $4,500 in rent each month with the lease ending on May 31, 2015.

The papers claimed The Penguin Drive-In "ceased to operate and failed to maintain electric services at the premises."

Court papers said it appears the building has been "abandoned."

The bankruptcy filing on Thursday came just moments before the eviction hearing that was scheduled for 10:00 a.m., reports Adam O'Daniel of The Charlotte Business Journal. While the landlord is allowed to move forward with the eviction process, O'Daniel emphasizes that combining the bankruptcy filing and the eviction process "makes a big mess of the situation."

"This probably delays if not puts even more doubt on the Penguin ever reopening in that spot," O'Daniel continued.

After filing for voluntary Chapter 11, Ballentine issued a statement saying, "The Penguin appreciates the tremendous amount of love and support we receive each day from our loyal customers, the Plaza Midwood neighborhood, and all of the members of the news media."

Ballentine continues saying, "We will reopen for business next week, after our first break in over five years."

Since 2010, when the Ballentine family regained managerial control over the restaurant, there has been financial trouble, including a lawsuit from the landlords claiming the owners defaulted on an $18,000 loan. That lawsuit was later thrown out.

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