In September and October of 2011, several restaurant chains owned by private equity firm Sun Capital – Friendly’s, the iconic ice cream parlor and family restaurant, SSI Group, which operates Grandy’s and Souper Salad restaurants, and Real Mex, which operates El Torito Restaurant and Chevys Fresh Mex – all entered bankruptcy. In the case of Friendly’s, Sun Capital sought to use the bankruptcy proceedings to write off debt and to rid itself of the company’s pension obligations to its nearly 6,000 employees and retirees while continuing to own the restaurant chain. Immediately after Friendly’s entered bankruptcy another Sun Capital affiliate announced its intention to acquire Friendly’s. With less than two months between the bankruptcy announcement and the date set for the auction of Friendly’s, no other bidders came forward. On December 29 Judge Kevin Gross approved the sale and Sun Capital closed out 2011 allowed to “buy” Friendly’s in a “credit-bid” sale – that is, Sun Capital got to hold onto ownership of Friendly’s just by wiping out a $75 million loan it had made to Friendly’s and assuming Friendly’s liabilities. A key part of Sun Capital’s restructuring plan is to shift liability for Friendly’s pension plan to the federal government’s Pension Benefit Guaranty Corporation (PBGC). Generally, PBGC does not require companies to make good on pension plans they can no longer afford. But in an unusual move, PBGC accused Sun Capital of fraud and announced that it will fight Sun Capital’s attempt to stick US taxpayers with the bill. PBGC objects to what appears to be a transparent effort by Sun Capital to take advantage of the bankruptcy process to abandon pension obligations while continuing to keep its ownership of Friendly’s.