Donald W. Callender, a county businessman who founded Marie Callender Pie Shops, filed a fourth lawsuit Monday against Ramada Inc., which bought the restaurant chain two years ago.
Callender, who sold Marie Callender’s to Ramada in 1986 for about $80 million in cash and stock, is Ramada’s second-largest shareholder.
The latest lawsuit, filed in Orange County Superior Court in Santa Ana, seeks $371 million in damages on behalf of Ramada shareholders.
Rejected Hyatt Buyout
It contends that Ramada directors shortchanged stockholders and the company by rejecting a $10-a-share buyout offer from an affiliate of the Hyatt hotel chain.
The $371 million is the amount that HCC Corp. of Chicago offered last month for all outstanding Ramada stock that it did not already own. HCC is owned by the Pritzker family of Chicago, Ramada’s largest stockholder.
On Sept. 16, the directors of Chicago-based Ramada rejected that price as “grossly inadequate and unfair.”
A Ramada spokesman, Joe Cole, called the suit’s allegations “unfounded” and said the company will respond in court.
Cole declined comment on Callender’s other legal actions against the company: “He’s sued us so often, it has become difficult to respond in any fashion in public.”
Randall S. Waier, the attorney who represents Callender, said the suit would permit participation by the company’s 33,000 shareholders.
The stockholder’s lawsuit is the fourth that Callender has brought against Ramada since January. All of them are pending and stem from a five-year contract between Ramada and Callender for Callender’s consulting company to aid the Marie Callender’s chain.
Pieces of the Pie
Both sides are suing each other over pie royalties and charges of mismanagement. Several weeks ago, Callender alleged, Ramada broke off the contract for the 135 restaurants.
One of Callender’s suits asks the court to drop restrictions that require Callender to hold his Ramada stock for five years, Waier said. Callender wants to sell the stock he received two years ago in the Marie Callender’s deal.
Securities analysts have valued Ramada at $11 to $13 a share. In the last five years, the high for Ramada’s stock has been $11.88, but Ramada shares have traded as low as $4 in the last year. Earnings per share have suffered as operating income at Ramada has fallen during three of the last four years.