Three Sonic Drive-In restaurants in the Sacramento area have closed, the latest and perhaps final casualties of the business demise of Roseville developer Abe Alizadeh and his restaurant empire.
Alizadeh’s attorney Mir Saied Kashani said Thursday that Alizadeh closed his Sonic restaurants in Roseville, Yuba City and Woodland at the request of the state Board of Equalization, which collects sales tax revenue.
The restaurants closed Wednesday, said spokesman Patrick Lenow of Sonic Corp., the Oklahoma company that oversees the drive-in chain. He said Sonic hopes to find a new franchisee for the three locations, but a reopening isn’t imminent. “It’s going to take a while to sort that out,” Lenow said.
Kashani said the three restaurants were “under tremendous pressure” because of tax-collection levies imposed by the Internal Revenue Service. Because of the IRS’ moves, the restaurants weren’t able to pay other bills, including the debts owed to the state, he said. That prompted the BOE to ask Alizadeh to close the restaurants, Kashani said.
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The BOE wouldn’t comment on the Alizadeh matter, but a spokesman said the agency doesn’t ask businesses to close. Rather, it encourages them to pay their taxes and works with those who have fallen behind on their payments.
The Sonic restaurants appear to be the last of what had been a string of more than 70 fast-food and upscale restaurants built by Alizadeh. His Crush 29 and Suede Blue restaurants in Roseville closed over the summer. At one time, he also owned dozens of Jack in the Box and TGI Friday’s restaurants in the Sacramento region and in the Central Valley.
“I’m not aware of any other restaurants that Abe Alizadeh is running at this time,” Kashani said.
Alizadeh’s various restaurant and development companies filed for bankruptcy protection in a series of cases starting in 2008, citing debts totaling $390 million. In early 2011, he was arrested on charges of deliberately failing to pay $7 million in California sales and payroll taxes. After pleading no contest to charges of grand theft and two misdemeanors, he was spared prison time but agreed to pay the state $1.2 million over four years.
In February, the U.S. government sued Alizadeh and three siblings over unpaid federal withholding taxes on his restaurants. The suit, which is still pending, says Abe Alizadeh owes the government $7.6 million and his siblings owe a total of $13 million.