Plaintiff (restaurant chain) accuses Defendant (supplier) of Fraudulent Misconduct

Waffle House, Inc., a beloved American breakfast chain, has filed a lawsuit against a supplier it once trusted, alleging fraud and financial misconduct. The complaint was lodged in the United States District Court for the Western District of North Carolina on January 28, 2026, targeting Paramount Produce Inc., along with Matthew James Elledge and Brandi Nichole Elledge. Waffle House claims that these defendants have jeopardized its critical supply chain by misappropriating funds meant for suppliers.

The case centers around an arrangement that began in 2017 when Waffle House started doing business with Matthew Elledge, operating as Paramount Produce. This partnership involved distributing eggs and dairy products to various Waffle House locations. Paramount was responsible for purchasing these products from suppliers like Rose Acre Farms and MilkCo, delivering them to Waffle House, and then invoicing the restaurant chain for payment. However, by August 2025, the Elledges allegedly began defrauding Waffle House by failing to pay the suppliers after receiving payments from Waffle House. Instead, they are accused of using these funds to support their personal lifestyle.

Waffle House’s complaint outlines several accusations against the defendants: breach of contract for failing to pay suppliers with funds provided by Waffle House; fraud against both Waffle House and its suppliers; and unfair trade practices under North Carolina law. The restaurant chain is seeking multiple forms of relief from the court: monetary damages exceeding $850,000; piercing the corporate veil to hold the Elledges personally liable; appointment of a receiver over Paramount Produce’s assets; pre-judgment attachment of assets; attorney’s fees and treble damages under state law; equitable relief for unjust enrichment; imposition of a constructive trust on misappropriated funds; and injunctive relief to maintain status quo during litigation.

Representing Waffle House in this legal battle are attorneys Lance P. Martin and Norman J. Leonard from Ward and Smith, P.A., based in Asheville, North Carolina. The case is being heard under Civil Action File No. 26-cv-00031.