Red Lobster’s Everyday Endless Shrimp deal seemed too good to be true. In June of 2023, the promotion was turned into a permanent menu item, offering customers unlimited servings of shrimp for just $20. The move was a head-scratcher: How could a deal like that possibly be profitable? Turns out, it wasn’t—and a new lawsuit claims that may have been on purpose.
The Red Lobster GUC Trust, a liquidation trust formed when Red Lobster filed for bankruptcy in 2024, is suing former majority stakeholder Thai Union Group, a Thai seafood company. The lawsuit alleges that Thai Union treated Red Lobster “as little more than a distribution arm for its own products, milking whatever value it could from Red Lobster, especially as the Company became insolvent.”
That included limiting Red Lobster’s choice of seafood suppliers, interfering in its leadership, and pushing for the Endless Shrimp deal that led to the company’s bankruptcy, according to the lawsuit.
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‘A car crash’: How endless shrimp doomed Red Lobster
The lawsuit’s complaints start with the appointment of Thai Union employee and Red Lobster Master Holdings GP Board member Paul Kenny as interim CEO. Kenny and Thai Union allegedly drove the former CEO to resign, then pushed Red Lobster to purchase massive amounts of “overpriced Thai Union Shrimp,” even in the face of insolvency.
Then came the Everyday $20 Ultimate Endless Shrimp deal, which the lawsuit calls “a campaign to squeeze out every drop of value” from Red Lobster. The lawsuit claims that despite company leaders being warned that the deal would lead to significant losses, they moved forward with the deal, also banning one of Thai Union’s competing seafood suppliers. “Overpriced” ingredients and the deal’s cheap price tag allegedly led directly to Red Lobster’s bankruptcy filing.
The promotion “turned a successful legacy Red Lobster strategy to drive traffic into its restaurants into a car crash,” reads the complaint. Even a price hike from $20 to $25 couldn’t salvage the deal: Red Lobster still reported a record loss of $12.5 million in the fourth quarter of 2023.
Thai Union exited Red Lobster in early 2024, reporting a $19 million loss from the company across the first nine months of 2023.
Neither Red Lobster nor Thai Union Group have replied to Fast Company’s request for comment.
Red Lobster’s brand rehab
Since its promotion-gone-wrong in 2023 and bankruptcy in 2024, Red Lobster has clawed its way back, thanks in no small part to a cultural rebrand from new CEO Damola Adamolekun.
Adamolekun took the helm of Red Lobster in August of 2024, becoming the youngest CEO in the company’s history at just 35 years old. He struck the Ultimate Endless Shrimp deal from the restaurant’s permanent menu, joking, “I know how to do math” (and thus recognizing the promotion’s lack of business sense).
Under Adamolekun’s leadership, Red Lobster has bounced back from bankruptcy, even bringing Endless Shrimp back to its menu this April for a limited time only, finding a middle ground between fan demand and the brand’s previous missteps.
“This is about putting our guests first and bringing back something they truly love,” Adamolekun said in a press release at the time.
“Endless Shrimp has been a part of Red Lobster’s legacy for 20 years and our guests have never stopped asking for it,” he continued. “We’re excited to bring it back, for a limited time, in a way that works for our business today and honors what made it special from the beginning. Because when our fans talk, we listen.”