Qdoba franchisee defaults on $20 million loan

Bank Midwest claims that a major Qdoba franchisee, Pennsylvania-based The Integritty Group (TIG), has defaulted on a $20 million loan that was taken out in April 2025, leaving approximately $18.3 million in outstanding debt across 41 restaurants.

The bank filed a lawsuit against the franchisee on Aug. 6 in the U.S. District Court for the Eastern District of Pennsylvania. The suit includes dozens of related Queso Time restaurant companies operating in Delaware, New Jersey, New York, Pennsylvania, and Florida.

According to court filings, Bank Midwest said the franchisee violated terms of its loan agreements and failed to correct the problem after being given an opportunity to do so. The bank alleges that TIG had developed a major liquidity problem and failed to disclose it.

The suit alleges that the franchisee entered into an agreement to terminate its Qdoba franchise relationship and sell the restaurants without notifying the bank, potentially threatening the collateral securing the loan.

Bank Midwest is now seeking the appointment of a receiver to manage and eventually sell the 41 locations to repay the debt.

Per court filings, TIG owed approximately $432,000 in August rent for its Qdoba locations, more than $1 million in unpaid sales taxes, and over $300,000 owed to DoorDash. Notably, the bank offered $850,000 in emergency funding to stabilize operations, but TIG never signed the paperwork necessary to draw the funds. The case is ongoing.

In a statement emailed to Nation’s Restaurant News, a company spokesperson wrote, “Qdoba is not a party to this complaint and has no comment on the allegations. We remain focused on serving our guests across the Philadelphia market.”

TIG also operates restaurants within the Dave’s Hot Chicken, Checkers, and The Greene Turtle systems. Late last year, the company had plans to develop 10 more Qdoba restaurants, according to Franchise Times, while its website stated that its goal was to surpass 100 units by 2030. Its website is currently offline, undergoing updates.