A new lawsuit alleges that Red Lobster's $20 endless shrimp promotion wasn't a marketing misstep but a deliberate scheme by Thai Union Group to extract value before the chain's 2024 bankruptcy. Creditors owed approximately $295 million are seeking damages, claiming the seafood giant forced Red Lobster into unfavorable shrimp purchases that bankrupted the business.

According to the Florida complaint, Thai Union executive Paul Kenny took operational control from CEO Kelli Valade, banned competing suppliers, and made the promotion permanent in May 2023. Kenny allegedly directed Red Lobster to buy shrimp exclusively from Thai Union at above-market rates, abandoning the chain's diversified supplier strategy. Multiple sources confirm Kenny positioned himself as the real decision-maker, overriding normal procurement procedures.

The promotion's shift to premium shrimp at the promotional price reportedly cost Red Lobster $11 million and drove customers away from higher-margin menu items. When the chain defaulted on its Fortress Investment Group loan in 2023, Thai Union refused additional funding and announced its exit strategy. Red Lobster filed bankruptcy in May 2024, leaving vendors and distributors unpaid.

The creditor trust seeks to unwind $32 million in allegedly coercive transactions from 2023, arguing Thai Union engaged in self-dealing that destroyed the restaurant chain's value. Red Lobster now operates under Fortress-led ownership with new management attempting a turnaround, having recently revived the shrimp promotion using different suppliers.