The Defunct Mexican Restaurant Chain Making A Comeback In 2025
On December 3, Chi-Chi's Restaurants LLC and Hormel Foods Corporation made an announcement that few people would have expected: Chi-Chi's restaurants are back. Michael McDermott, founder of Chi-Chi's Restaurants LLC and son of original Chi-Chi's co-founder Marno McDermott, will spearhead the relaunch with the first restaurants opening in 2025. According to McDermott, the new restaurants will keep the "same great taste and Mexican flavor" as the original Chi-Chi's while offering an updated approach that will appeal to today's restaurant customers.
CNN reports that McDermott brings not only his family's long association with Chi-Chi's but also years of restaurant industry expertise to this comeback effort. McDermott founded the Kona Grill restaurant chain, selling it to The ONE Group Hospitality, Inc., parent company of STK steakhouses, in 2019. McDermott is also the founder of Rojo Mexican Grill, which currently has two locations in Minnesota.
Prandium, Inc., the parent company of the original Chi-Chi's restaurant chain, filed for bankruptcy in 2002. The last surviving Chi-Chi's restaurant, located in Vienna, Austria, closed in 2024.
[Image by Tauralbus via Flickr | Cropped and scaled | CC BY-2.0]
Chi-Chi's closure happened under a cloud of controversy
Michael McDermott is facing some obstacles as he works to revive the Chi-Chi's restaurant brand. While many people are familiar with Chi-Chi's salsa and other Mexican food products, which can be found at many grocery stores, they may still associate the Chi-Chi's restaurant experience with piñatas, serapes, and giant sombreros — definitely not typical Mexican restaurant décor today. McDermott's plans to update the new Chi-Chi's restaurants while keeping its Tex-Mex flavors will help resolve this issue.
What some people remember best about Chi-Chi's, however, might take longer to overcome. In 2003, after its parent company had filed for bankruptcy, a hepatitis A outbreak was traced to green onions served at a Chi-Chi's restaurant in Monaca, Pennsylvania. Over 650 people came down with hepatitis A, with four people dying. Even though Prandium was already in bankruptcy proceedings, people could file claims against Chi-Chi's over the hepatitis A outbreak, thanks to a bankruptcy court ruling. The company eventually settled with the 9,489 people who had to get immune globulin shots to protect against hepatitis A, according to the Marler Clark food safety law firm.
The Chi-Chi's bankruptcy case and the hepatitis A outbreak are intertwined in many people's minds, even though Prandium had filed for bankruptcy before anyone got sick. McDermott will need to revive diners' memories of good times and great food at Chi-Chi's, like its salsa and Mexican fried ice cream, to make the chain's comeback a success.
[Image by Sarah Stierch via Flickr | Cropped and scaled | CC BY-2.0]