Red Lobster's Ultimate Endless Shrimp promotion cost the chain $11 million in the third quarter of 2023 and another $12.5 million in the fourth quarter—losses that preceded a May 2024 Chapter 11 filing carrying $692 million in total liabilities.

Those quarterly figures, pulled from bankruptcy court records, now anchor a creditors' trust lawsuit filed in May against Red Lobster's former controlling owners, Thai Union and Seafood Alliance. The complaint alleges the Thailand-based seafood giant extracted at least $32 million in avoidable purchases and roughly $23 million in overpayment, with a Florida trial scheduled for early 2028.

What does the lawsuit claim happened?

At the center sits Paul Kenny, an Australian executive who co-led Seafood Alliance when it assumed full Red Lobster control in 2020 and later served as interim CEO. Multiple former executives said Kenny set the $20 price point for Ultimate Endless Shrimp over internal objections and without standard pricing analysis.

Kenny then ordered a 2023 "quality review" of the chain's three main shrimp suppliers. After minor non-food-safety infractions surfaced, longtime supplier Red Chamber was disqualified, allowing Thai Union to win every pre-breaded shrimp contract at a higher price and 46% of Red Lobster's overall shrimp volume.

Red Lobster paid $4.83 per pound for frozen pre-breaded shrimp versus $4.27 before—a $0.56 spread that added $32 million to costs, according to the complaint. "Paul was looking for every way to put more shrimp on the plate," one former executive said.

Demand then ran at roughly twice what operations had budgeted. Guests occupied tables for two hours working through scampi, coconut, Alfredo, skewered and butterfly-fried preparations. The chain ran out of shrimp in some markets and turned away regulars who couldn't get a seat.

Was Endless Shrimp really the cause of bankruptcy?

Long-tenured employees say no. Pete Gaston, a 42-year Red Lobster veteran who retired in 2022 as regional director over South Carolina, lost $175,000 in deferred compensation when the company collapsed. Court records show more than $12 million in deferred compensation went unpaid, plus $16.7 million in unpaid wages.

"This whole thing, just to be clear, just to be 100% crystal, it is not about Endless Shrimp," Gaston said. "It's about the leases."

Those leases date to Darden Restaurants' 2014 sale of Red Lobster to Golden Gate Capital for $2.1 billion. Golden Gate immediately sold more than 500 Red Lobster properties to American Realty Capital Properties—now Realty Income—in a $1.5 billion sale-leaseback that effectively financed the buy. The resulting 25-year master lease carried 2% annual escalators. By 2023, lease obligations had reached $190.5 million for the year, with more than $64 million tied to underperforming units.

What is the new operator doing differently?

Red Lobster emerged from bankruptcy in roughly three months under Fortress Investment Group, which bought the chain out of Chapter 11. Damola Adamolekun, 35 at his appointment and the chain's youngest-ever CEO, killed Ultimate Endless Shrimp on day one and joked that the decision was "natural" because "I know how to do math."

Thai Union wrote off its $530 million investment in January 2024. In a motion to dismiss the creditors' suit, Thai Union called the allegations "a cynical attempt by Red Lobster to blame one of its former owners and suppliers for the failures of Red Lobster's own management decisions and business model."

Adamolekun has since brought Endless Shrimp back in two limited windows during 2026—at $24.99 in most markets and $29.99 in higher-rent locations. He has also rolled out seafood boils, bagged feasts of crab, lobster, shrimp, corn, potatoes and smoked sausage engineered for social video.

Whether menu engineering and a higher check average now outrun the legacy 2% annual rent escalators will determine whether Adamolekun's turnaround math holds—and whether Thai Union's costly exit looks any cleaner once a Florida courtroom weighs in early next year.