TAMPA — The legal drama is not over, but the Mini Doughnut Factory is.

Less than a month after shuttering its St. Petersburg location, the doughnut shop announced on its website that the flagship South Tampa location on S Dale Mabry Highway also has closed.

A statement on the Mini Doughnut Factory website says, “We doughnut want to break your heart, but we are officially closed.” Lee Kearney, an investor, held the majority stake in the business and is the one who closed both shops. The company declined comment on Tuesday.

Meanwhile, shop founders Patrick and Zezura Ruddell are counter-suing Kearney and his associated companies for damages. They’re accusing the real estate agent and entrepreneur of unlawfully taking control of the Mini Doughnut Factory.

“Really, (the investors) damaged the entire population of Tampa Bay, because those doughnuts were amazing,” said the Ruddells’ attorney, David Fernandez. “This is what happens when you get greedy investors who go after a mom-and-pop shop.”

In court documents filed early this year, Kearney accused the couple of owing him $875,000. He also said failures by the couple to run the business broke an agreement and turned ownership rights over to him — something the Ruddells are now disputing in court.

The founders argue Kearney and another investor, Chris Mercer, failed to create a board of directors and appoint a chair when they joined the company in 2016. When Mercer signed over his assets to Kearney, it made the Ruddells “a minority interest” without their consent, according to court documents. A chair should have overseen that transfer, according to the Ruddells’ attorney.

Fernandez said the trouble began because Kearney and Mercer wanted a quicker return on investment than realistic for a family-run business.

“They squeezed the Ruddells,” Fernandez said, “in a very fast, legally strategic way.”

Kearney filed two blistering lawsuits against the Ruddells in December and January, which accused the couple of mismanaging its budget, spending business money on personal use, missing bill payments and losing tens of thousands of dollars in sales.

The Ruddells asked the court last week to combine those two lawsuits into one.

Kearney said in filings that the Ruddells were uncooperative in handing over needed information to run both doughnut shops, which closed temporarily during the height of the dispute. The couple did eventually agree to turn over passwords to social media, company cars and email access.

“They wanted the business, and the Rudells gave it to them,” Fernandez said. “Kearney ran it into the ground and now he has to deal with the fallout.”

Contact Sara DiNatale at [email protected] Follow @sara_dinatale.



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