JERICHO, N.Y. (AP) — Fast-food chain Nathan's Famous Inc. said Monday that it could owe $2.9 million to $6.1 million in a legal dispute with a licensee and it expects to record a charge of $2.9 million for its second quarter, which ended Sept. 26.
Licensee SMG Inc., which makes and sells packaged Nathan's hot dogs, has gone to court with Nathan's Famous Inc. over whether Nathan's may terminate a licensee agreement. A trial on some claims in the case has ended without a ruling so far.
But the Illinois state court judge in the case did grant SMG's motion for summary judgment on claims relating to whether Nathan's was entitled to money from the sale of its proprietary seasonings to SMG.
Nathan's said Monday that a hearing is set Nov. 22 to determine exactly what Nathan's must pay SMG.
Shares of Nathan's fell 39 cents to close Monday at $16.61. They fell 39 cents more after hours.