SEC v. FAT Brands Inc.; Andrew Wiederhorn; Ron Roe; and Rebecca Hershinger, No. 2:24-CV-03913, Central District of California (May 10, 2024) — Complaint

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STEPHEN T. KAM (Cal. Bar No. 327576)
Email:  [email protected]
ROBERT C. STILLWELL (Cal. Bar No. 308630)
Email: [email protected]

Attorneys for Plaintiff
Securities and Exchange Commission
Katharine E. Zoladz, Regional Director
Gary Y. Leung, Associate Regional Director
Douglas M. Miller, Regional Trial Counsel
444 S. Flower Street, Suite 900
Los Angeles, California 90071
Telephone: (323) 965-3998
Facsimile: (213) 443-1904
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

SECURITIES AND EXCHANGE
COMMISSION,
Plaintiff,

vs.
FAT BRANDS INC., ANDREW
WIEDERHORN, RON ROE, and
REBECCA HERSHINGER,
Defendants.

    Case No.

COMPLAINT

DEMAND FOR JURY TRIAL

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Plaintiff Securities and Exchange Commission (“SEC”) alleges:
JURISDICTION AND VENUE
1. The Court has jurisdiction over this action pursuant to Sections 20(b),
20(d)(1) and 22(a) of the Securities Act of 1933 (“Securities Act”), 15 U.S.C. §§
77t(b), 77t(d)(1) & 77v(a), and Sections 21(d)(1), 21(d)(3)(A), 21(e) and 27(a) of the
Securities Exchange Act of 1934 (“Exchange Act”), 15 U.S.C. §§ 78u(d)(1),
78u(d)(3)(A), 78u(e) & 78aa(a).
2. Defendants have, directly or indirectly, made use of the means or
instrumentalities of interstate commerce, of the mails, or of the facilities of a national
securities exchange in connection with the transactions, acts, practices and courses of
business alleged in this complaint.
3. Venue is proper in this district pursuant to Section 22(a) of the Securities
Act, 15 U.S.C. § 77v(a), and Section 27(a) of the Exchange Act, 15 U.S.C. § 78aa(a),
because certain of the transactions, acts, practices and courses of conduct constituting
violations of the federal securities laws occurred within this district.  In addition,
venue is proper in this district because Defendants Andrew Wiederhorn, Ron Roe,
and Rebecca Hershinger reside in this district, and Defendant FAT Brands Inc. has its
principal place of business in this district.
SUMMARY
4. Between October 2017 and March 2021 (the “Relevant Period”),
Andrew Wiederhorn (“Wiederhorn”), the former chief executive officer and current
director and controlling shareholder of FAT Brands Inc. (“FAT” or the “Company”)
used almost $27 million of FAT’s cash on his personal expenses including private
jets, first class airfare, luxury vacations, his rent and mortgage payments, shopping,
and jewelry.  During this time, Wiederhorn falsely told the Company’s auditors,
board of directors, and investors that neither he nor his family members had any
direct or indirect material interest in the FAT cash that Wiederhorn used for those
personal expenditures.

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5. Between July 2018 and March 2021, Wiederhorn engaged in deceptive
acts and made false and misleading statements to make it appear that the millions of
dollars of FAT’s money he was spending on himself and on his family each year
were company loans to FAT’s affiliate Fog Cutter Capital Group, Inc. (“FCCG”),
another company that Wiederhorn controlled, for FCCG’s business expenses.
Wiederhorn used his control over FCCG to take the money that FCCG was receiving
from FAT and spend it on himself.  Wiederhorn then misled FAT’s board of directors
(the “FAT Board”) and the Company’s auditors, leading them to believe that FCCG
was using the proceeds from FAT’s loans solely for FCCG’s business expenses and
pre-existing liabilities.
6. Although this fraudulent scheme allowed Wiederhorn to hide from the
FAT Board, the Company’s auditors, and investors the fact that he was spending
FAT’s cash to fund his lavish lifestyle, it stripped FAT of approximately 40 percent
of its revenue during the Relevant Period, often leaving the Company with
insufficient cash to pay its own bills.  Between 2017 and 2019, Wiederhorn instructed
his son to wire over $9 million into FAT, concealing that Wiederhorn used millions
of FAT’s funds for his own personal spending and that FAT was otherwise unable to
pay its own bills.
7. Wiederhorn enlisted the help of Ron Roe (“Roe”), the Company’s
former chief financial officer (“CFO”) and current senior vice president (“SVP”) of
finance and executive officer to execute his scheme.  Roe used his position at the
Company to send FAT funds to Wiederhorn, Wiederhorn’s family, or Wiederhorn’s
creditors.  Both Roe and Rebecca Hershinger (“Hershinger”), another former CFO at
FAT, personally signed, certified, and disseminated false and misleading statements
that failed to properly disclose Wiederhorn’s personal interest in these transactions.
8. By engaging in this conduct:  (i) FAT violated Section 17(a)(2) of the
Securities Act of 1933 (“Securities Act”), Sections 10(b), 13(a), 13(b)(2)(A),
13(b)(2)(B), 13(k), and 14(a) of the Securities Exchange Act of 1934 (“Exchange

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Act”) and Rules 10b-5(b), 12b-20, 13a-1, 13a-13, 14a-3, and 14a-9 thereunder; (ii)
Wiederhorn violated Sections 17(a)(1) and (3) of the Securities Act, Sections 10(b),
13(b)(5), and 14(a) of the Exchange Act and Rules 10b-5, 13a-14, 13b2-1, 13b2-2,
14a-3 and 14a-9 thereunder; and aided and abetted FAT’s primary violations of
Section 17(a)(2) of the Securities Act, Sections 13(a), 13(b)(2)(A), 13(b)(2)(B), and
13(k) of the Exchange Act and Rules 12b-20, 13a-1, and 13a-13 thereunder; (iii) Roe
violated Section 10(b) of the Exchange Act and Rules 10b-5(b), 13a-14, and 13b2-2
thereunder; aided and abetted Wiederhorn’s primary violations of Sections 17(a)(1)
and (3) of the Securities Act, and Section 10(b) of the Exchange Act and Rules 10b-
5(a) and (c) thereunder; and aided and abetted FAT’s primary violations of Sections
13(a), 13(b)(2)(A), 13(b)(2)(B), and 13(k) of the Exchange Act and Rules 12b-20 and
13a-1 thereunder; and (iv) Hershinger violated Section 10(b) of the Exchange Act and
Rules 10b-5(b), 13a-14, and 13b2-2 thereunder; and aided and abetted FAT’s primary
violations of Section 17(a)(2) of the Securities Act and Sections 13(a), 13(b)(2)(A),
13(b)(2)(B) of the Exchange Act and Rules 12b-20 and 13a-1 thereunder.
9. The SEC requests that the Court impose permanent injunctions against
each of the Defendants for their respective violations of the federal securities laws,
and bar Wiederhorn, Roe, and Hershinger from acting as an officer or director of a
public issuer pursuant to Section 21(d)(2) of the Exchange Act.  The SEC requests
that the Court order FAT and Wiederhorn to disgorge their ill-gotten gains with
prejudgment interest thereon.  The SEC requests that the Court assess civil money
penalties against FAT, Wiederhorn, Roe, and Hershinger, pursuant to Sections
21(d)(3) of the Exchange Act and 20(d) of the Securities Act.
DEFENDANTS
10. FAT Brands Inc. is a Delaware corporation with its principal place of
business in Beverly Hills, California.  FAT owns 17 restaurant brands, including
Fatburger, Johnny Rockets, and Twin Peaks.  During the Relevant Period, FAT was a
reporting company with its securities registered with the SEC pursuant to Section 12

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of the Exchange Act.  During the Relevant Period, FAT filed annual Forms 10-K and
quarterly Forms 10-Q.  During the Relevant Period, FAT conducted an offering
pursuant to Regulation A in September 2019 and an offering pursuant to Form S-1 in
July 2020.
11. Andrew Wiederhorn, age 58, is a resident of Beverly Hills, California.
During the Relevant Period, Mr. Wiederhorn served as FAT’s and FCCG’s chief
executive officers at all relevant times.  In 2004, Wiederhorn pleaded guilty to two
federal felony criminal charges for paying an illegal gratuity and filing a false tax
return.  Wiederhorn served 14 months in prison.
12. Ron Roe, age 46, is a resident of Los Angeles, California. Roe served as
FAT’s CFO from October 20, 2017 through August 16, 2018, and SVP of finance,
from August 2018 through the present.
13. Rebecca Hershinger, age 50, is a resident of Los Angeles, California.
Hershinger was FAT’s CFO from August 16, 2018 through May 31, 2021.
RELATED PARTIES
14. Fog Cutter Capital Group, Inc. was, until it merged with FAT on
December 24, 2020, a Maryland corporation with a principal place of business in
Oregon.  FCCG had been listed on NASDAQ until 2004, when it was delisted for
conduct involving improper payments to Wiederhorn.  During the Relevant Period,
Wiederhorn was FCCG’s Chief Executive Officer and owned between 30 and 45
percent of its shares.  Wiederhorn and his family collectively owned about 60 percent
of FCCG’s shares during that same period, and FCCG, in turn, owned at least 80
percent of FAT’s shares.
15. Thayer Wiederhorn (“Thayer”), age 35, is a resident of Los Angeles,
California.  Thayer is currently Chief Operating Officer of FAT and was Chief
Marketing Officer during the relevant period.  Thayer is Andrew Wiederhorn’s son.
///
///

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THE ALLEGATIONS
A. Wiederhorn Created FCCG and Later Formed FAT as Its
Subsidiary
16. Wiederhorn formed FCCG in 1998.
17. In 2017, Wiederhorn formed FAT as a wholly owned subsidiary of
FCCG, with FCCG owning 80 percent FAT’s shares.
18. During the Relevant Period, Wiederhorn held approximately 40 percent
of FCCG’s shares and served as the chief executive officer (“CEO”) of both FAT and
FCCG.
19. Wiederhorn controlled both FAT and FCCG, including directing,
authorizing and approving all wires, transfers and bill payments to and from both
FAT’s and FCCG’s accounts.
20. Wiederhorn’s annual salary as CEO of FAT, according to the
Company’s public filings, was $400,000.
21. On October 20, 2017, FAT conducted an initial public offering (“IPO”).
Following the IPO, FAT was required to make certain disclosures in its SEC filings
as a reporting company with securities registered with the SEC pursuant to Section 12
of the Exchange Act.
22. At the time of the IPO, FCCG had just two revenue-generating
businesses: the restaurant chains Fatburger North America, Inc. (“Fatburger”) and
Buffalo’s Franchise Concepts, Inc. (“Buffalo”).
23. FCCG transferred ownership of Fatburger and Buffalo to FAT in
connection with the IPO, leaving FCCG with essentially no revenue and no business
operations.  FCCG continued to hold as an asset approximately $100 million in net
operating losses that could be made available to FAT under certain conditions to
reduce the Company’s tax liabilities.
24. In exchange for these two businesses, FAT issued a $30 million
promissory note (the “FCCG Promissory Note”) to FCCG.

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25. Ron Roe, the chief financial officer (“CFO”) of FCCG, became the CFO
of FAT in connection with the IPO and served in that position until August 2018.
The cash management team that Roe oversaw at FCCG transferred to FAT in
connection with the IPO.
26. In August 2018, Hershinger took over as the CFO of FAT and served in
that position until May 2021.
B. As a Reporting Company, FAT Was Required to Disclose Related
Person Transactions
27. During the Relevant Period, Regulation S-K Items 404 (a) and (d) (“Item
404”) required FAT, as a reporting company, to describe in certain SEC filings,
including in the Company’s Forms 10-K and proxy statements, any transaction, or
series of similar transactions in which FAT was a participant and the amount
involved exceeded $120,000, and in which any related person—including any
director or executive officer of FAT and any immediate family member of a direct or
executive officer—had or will have a direct or indirect material interest.  These
transactions are commonly referred to as related person transactions.
28. For any related person transactions, Item 404 required FAT in certain
SEC filings to describe, among other things:  the name of the related person and the
basis on which the person is a related person; the related person’s interest in the
transaction; the dollar amount involved in the transaction; the dollar value of the
related person’s interest in the transaction; and any other information regarding the
transaction or the related person in the context of the transaction that is material to
investors in light of the circumstances of the particular transaction.
C. Wiederhorn’s Direct or Indirect Interest in Certain FAT
Transactions
29. From October 2017 through December 2020, FAT’s revenue was
approximately $61 million.  During this time, Wiederhorn directed approximately
$38 million in FAT transfers to FCCG.

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30. Between October 2017 and in or about July 2018, the majority of the
funds that FAT transferred to FCCG were in repayment of the $30 million FCCG
Promissory Note.  By July 2018, the remaining balance due under the note was less
than $1 million, which FAT publicly reported it had fully paid back by September
2018.
31. Wiederhorn, however, directed FAT to continue transferring millions of
dollars to FCCG, even after the FCCG Promissory Note was fully paid back, through
what the company disclosed as intercompany lending from FAT to FCCG.
32. Wiederhorn had a direct or indirect material interest in the funds
transferred to FCCG because he borrowed a substantial portion of those funds from
FCCG and used those funds for his personal expenses, his family, and his personal
creditors (the “Wiederhorn Personal Cash Transfers”).
33. From July 2018 through December 2020, FAT’s revenue was
approximately $51.5 million.  During this time, Wiederhorn directed FAT to loan
approximately $28.3 million of FAT’s funds to FCCG as intercompany loans,
approximately $20 million of which he then used to fund Wiederhorn Personal Cash
Transfers.
34. The Wiederhorn Personal Cash Transfers were either direct transfers
from FAT’s company accounts to Wiederhorn’s personal accounts, his family, or his
creditors, or they were indirect transfers that first passed through FCCG’s bank
accounts before being sent to Wiederhorn’s personal accounts, his family, or his
creditors.
35. In either case, the Wiederhorn Personal Cash Transfers benefitted
Wiederhorn personally, not FAT or FCCG.  Wiederhorn used these transfers to pay
off his personal credit cards.  These transfers included payments for private jets, first
class airfare, luxury vacations, Wiederhorn’s mortgage and rent payments, and nearly
$700,000 in shopping and jewelry.
36. Wiederhorn was responsible for directing the transfers from FAT that

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funded Wiederhorn Personal Cash Transfers.  He required FAT’s cash managers to
prepare daily “cash reports” reflecting all of the funds in FAT’s, FCCG’s, and
Wiederhorn’s personal bank accounts, and met with the cash managers on an almost
daily basis to direct them as to which of his, or his creditors’, accounts the
Wiederhorn Personal Cash Transfers should be sent, and whether the transfers should
first pass through FCCG’s accounts.  The FAT cash managers followed Wiederhorn’s
direction as to how much and to which accounts FAT would send money.
37. From July 2018 through December 2020, the Wiederhorn Personal Cash
Transfers were recorded by FAT as intercompany loans to FCCG, even when the
funds were intended solely for Wiederhorn’s personal use and even though, in many
instances, the funds never even passed through FCCG’s accounts.
38. Between October 2017 and December 2020, the Wiederhorn Personal
Cash Transfers were never disclosed as related party transactions to FAT investors in
the Company’s public filings.
39. The Wiederhorn Personal Cash Transfers were never repaid and were
written off by FCCG at Wiederhorn’s discretion in 2020.
D. The Thayer Transactions Concealed FAT’s Inability to Pay its Own
Bills
40. In 2017, the Wiederhorn Personal Cash Transfers totaled approximately
$1.1 million, which was approximately 50 percent of FAT’s revenue during that year.
41. In 2018, the Wiederhorn Personal Cash Transfers totaled approximately
$9 million, which was approximately 49 percent of FAT’s revenue during that year.
42. In 2019, the Wiederhorn Personal Cash Transfers totaled more than $7
million, which was approximately 31 percent of FAT’s revenue during that year.
43. In 2020, the Wiederhorn Personal Cash Transfers totaled approximately
$9.6 million, which was approximately 53 percent of FAT’s revenue during that year.
44. From October 2017 through December 2020, the Wiederhorn Personal
Cash Transfers totaled approximately 44 percent of FAT’s revenue over that

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timeframe.
45. The Wiederhorn Personal Cash Transfers stripped FAT of cash to pay its
own bills.
46. Therefore, Wiederhorn instructed his son Thayer to transfer millions of
dollars in cash to FAT, because the Company’s accounts were frequently short on
cash and the Company was unable to pay its bills (the “Thayer Transactions”).  To
effectuate these transactions, Wiederhorn sent funds to Thayer’s personal accounts
using credit cards that were paid for by FAT.  Thayer would then transfer the funds
he received from Wiederhorn into specific FAT accounts as instructed by
Wiederhorn.
47. The Thayer Transactions were used when FAT needed cash to pay its
bills and expenses, including, among other things, its payroll and concealed the fact
that FAT was frequently short on cash.
48. From 2017 through 2019, the Thayer Transactions amounted to over $9
million sent to FAT’s bank accounts.
49. In 2017, the Thayer Transactions totaled approximately $220,000, which
was approximately 10 percent of FAT’s revenue during that year.
50. In 2018, the Thayer Transactions totaled approximately $5.5 million,
which was approximately 30 percent of FAT’s revenue during that year.
51. In 2019, the Thayer Transactions totaled approximately $3.5 million,
which was approximately 16 percent of FAT’s revenue during that year.
52. Wiederhorn directed the Thayer Transactions and directed the FAT cash
management team on how the wires were to be accounted for in FAT’s books.
53. The Thayer Transactions were never publicly disclosed as related person
transactions to the Company’s investors.
E. Wiederhorn Concealed the Nature of the Wiederhorn Personal Cash
Transfers and the Thayer Transactions
54. Wiederhorn concealed from FAT’s Board that the purpose of the loans

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from FAT to FCCG were to fund the Wiederhorn Personal Cash Transfers and to
benefit himself personally.  Due to this concealment, and the control that Wiederhorn
had over FAT as its CEO, he was able to carry out his fraudulent scheme for years.
55. Wiederhorn misrepresented to FAT’s Board that the loans from FAT to
FCCG were for FCCG’s business expenses.
56. For example, in May 2019, Wiederhorn sent email communications to
FAT’s Board representing that the loans were “for FCCG to pay [its] various tax and
legal settlements and other obligations.”
57. Similarly, in April 2020 emails with the FAT Board, Wiederhorn
represented that “funds at [FCCG] are used to pay pre-existing pre-IPO liabilities.”
Wiederhorn made similar statements at FAT board meetings in April 2020, telling the
FAT Board that the loans were used solely for FCCG’s business expenses and
concealing that they were primarily used for his personal benefit.
58. In addition, for fiscal years 2018 through 2020, Wiederhorn completed
annual director and officer questionnaires as the CEO of FAT that were submitted to
the Company’s auditors.  The stated purpose of the questionnaires, in pertinent part
was to provide FAT:
[W]ith information to be used in connection with preparation of the Company’s
[] Annual Report on Form 10-K to be filed with the U.S. Securities and Exchange
Commission [] and the Company’s Proxy Statement for its [] Annual Meeting
of Stockholders.
59. The questionnaires instructed that Wiederhorn disclose whether he or
any immediate family member had:
[A]ny material interest, direct or indirect, in any transaction or series of similar
transactions or proposed transaction or proposed series of similar transactions to
which the Company or any of its subsidiaries was or is to be a party, and in which
the amount involved exceeds $120,000.
60. Wiederhorn answered “no” to this question despite knowing that he had
a direct or indirect material interest in the transfers from FAT to FCCG that funded
the Wiederhorn Personal Cash Transfers, knowing Thayer (Wiederhorn’s immediate

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family) had a direct or indirect material interest in the Thayer Transactions between
2017 and 2019, and the fact that one or both of these series of transactions exceeded
$120,000 each year from 2018 through 2020.
61. Similarly, the questionnaires asked whether Wiederhorn:
Had  received  at  any  time  during  the  previous  24  months,  or  do  you  currently
have outstanding any loan or extension of credit in the form of a personal loan
from the Company or any of its affiliates?
62. Despite FCCG being an affiliate of FAT, Wiederhorn always answered
“no” to that question and did not disclose that he was taking funds in the form of
personal loans from FCCG to fund the Wiederhorn Personal Cash Transfers each
year.  Moreover, the Wiederhorn Personal Cash Transfers were a direct or indirect
extension of credit in the form of personal loans from FAT to Wiederhorn, the
Company’s CEO.
63. By engaging in this conduct, Wiederhorn furthered his scheme by
creating a false appearance that the funds that FAT was sending to FCCG were being
used solely for business purposes and that the Company had sufficient cash on hand
to pay its bills.
F. Wiederhorn Violated the Internal Controls Implemented by the
FAT Board
64. During the course of FAT’s 2019 audit, FAT’s auditor advised the
Company’s audit committee of a “significant deficiency” in FAT’s internal control
over financial reporting.  Specifically, in early 2020, FAT’s auditor identified that
“The CEO has the ability to transfer funds for parent company advances at no limit
without board approval” and that there was a “lack of sufficient controls around the
financial reporting process.”
65. At an April 14, 2020 board meeting, the FAT Board asked Wiederhorn
numerous questions about the purpose of FAT continuing to make loans to FCCG.  In
response, Wiederhorn told the FAT Board that the loans were for the purpose of

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paying off FCCG’s company creditors and business expenses.  Wiederhorn concealed
his personal interest in these transactions and the fact that most of the funds FAT had
loaned to FCCG were being used for the Wiederhorn Personal Cash Transfers.
66. Based on these false statements by Wiederhorn, the FAT Board
approved the Company continuing to send loans to FCGG through an Intercompany
Revolving Credit Agreement (the “Intercompany Agreement”) at the April 14, 2020
meeting.
67. The FAT Board would not have approved these additional loans if it had
known that the funds were and would be used to fund the Wiederhorn Personal Cash
Transfers.
68. In response to the auditor’s significant deficiency finding, the
Intercompany Agreement included a control, added by the FAT Board, requiring that
any additional lending to FCCG be approved in advance by the FAT Board.  The
FAT Board approved this control at the April 14, 2020 meeting.
69. At an April 21, 2020 meeting, the FAT Board again asked Wiederhorn
“numerous questions and engaged in rigorous discussion about the Intercompany
Revolving Credit Agreement [] between the Company and FCCG and the intended
uses of cash and the Company's business reasons for the Company to make advances
to FCCG.”  Wiederhorn again represented that the money would be used by FCCG to
pay its legacy liabilities and again concealed his personal use of the funds.
70. Based on these false statements, the FAT Board approved another
$50,000 of additional lending to FCCG.  Wiederhorn violated this Board-imposed
limitation and internal control by transferring almost $80,000 from FAT to FCCG
between April 15, 2020 and April 27, 2020.
71. Subsequently, at an April 28, 2020 meeting, the FAT Board approved
one final loan amount of $1 million to FCCG for second quarter of 2020.
72. However, after that date, without the FAT Board’s approval and in
contravention of the Intercompany Agreement, Wiederhorn continued to lend to

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FCCG millions of dollars and used the majority of the funds to make the Wiederhorn
Personal Cash Transfers.
73. From April 28, 2020 through approximately June 2020, Wiederhorn
directed hundreds of thousands of dollars in transfers from FAT to FCCG beyond the
$1 million authorized by the FAT Board.
74. In the third quarter of 2020, Wiederhorn directed another $3 million in
loans from FAT to FCCG, although the FAT Board authorized only $1 million.
75. In the fourth quarter of 2020, Wiederhorn directed over $3.5 million in
loans from FAT to FCCG.
G. The Wiederhorn Children Were Officers at FAT
76. During the Relevant Period, three of Wiederhorn’s children, including
Thayer, were highly paid officers at FAT.  Two Wiederhorn children, including
Thayer, had salaries of $300,000 a year in 2018 and 2019, and the third had a salary
of $250,000 (the “Wiederhorn Children Salaries”).
77. The Wiederhorn Children Salaries were not publicly disclosed to the
Company’s investors until November 2020, when it filed its 2020 Schedule 14A
Proxy Statement.
H. FAT’s 2022 Special Review Committee Investigation
78. In 2022, after learning of the SEC’s investigation, the FAT Board
learned that Wiederhorn had been potentially using the loans from FAT to FCCG for
his personal benefit.
79. In response, the FAT Board formed a Special Review Committee (the
“Committee”) consisting of independent board members to conduct an internal
investigation into FAT’s loans to FCCG.
80. During its investigation, the Committee confirmed that FAT’s loans to
FCCG funded the Wiederhorn Personal Cash Transfers.
I. In 2023, Wiederhorn Terminated the FAT Board
81. On December 20, 2022, Wiederhorn terminated the chair of the

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Committee.
82. In February 2023, the FAT executive chairman of the FAT Board,
having learned of the findings of the internal investigation, told Wiederhorn that he
should resign as CEO or the FAT Board would likely take action against Wiederhorn.
83. On March 28, 2023, Wiederhorn terminated the FAT executive chairman
and all of the other independent directors on the FAT Board.  He then placed three of
his children, including Thayer, on the FAT Board.
J. The Wiederhorn Personal Cash Transfers, the Thayer Transactions,
and the Wiederhorn Children Salaries Were Related Person
Transactions That FAT Was Required to Report Under Item 404
84. The Wiederhorn Personal Cash Transfers were related person
transactions under Item 404.
85. The transfers from FAT to FCCG that funded the Wiederhorn Personal
Cash Transfers amounted to more than $120,000 each fiscal year from 2017-2020.
86. Wiederhorn at all relevant times was a director and CEO of FAT, and
therefore a related person of the Company.
87. Wiederhorn had a direct or indirect material interest in the transfers from
FAT to FCCG because the transfers from FAT to FCCG funded the Wiederhorn
Personal Cash Transfers, which were used on Wiederhorn’s personal spending.  He
used the transfers from FAT for his own personal benefit to, among other things,
purchase travel on private jets, first class airfare, luxury vacations, his mortgage
payments, shopping, and jewelry.  Wiederhorn’s interest in the transfers from FAT
was material given that the transfers were for the purpose of funding his personal
accounts or paying his personal debts, the amount far exceeded his publicly disclosed
salary each year, and the amounts were equivalent to approximately 44 percent of
FAT’s revenue from October 2017 through December 2020 and 40 percent of FAT’s
revenue from July 2018 through December 2020.
88. The Thayer Transactions were also related person transactions under

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Item 404.
89. The Thayer Transactions amounted to more than $120,000 in each year
from 2017 to 2019, and Thayer was an immediate family member of Wiederhorn and
was the chief marketing officer of FAT.
90. Thayer also had a direct or indirect material interest in the Thayer
Transactions, as he used his own personal accounts to transfer substantial funds into
FAT.  Thayer’s interest in the Thayer Transactions was material given that over $9
million, which was an amount equal to about 21 percent of FAT’s revenue from
October 2017 through December 2019, was deposited into his personal accounts over
which only he had access or control.
91. The Wiederhorn Children Salaries were related person transactions
under Item 404.
92. The Wiederhorn children were immediate family members of
Wiederhorn, and they had a direct or indirect material interest in their salaries.
93. The Wiederhorn Children Salaries each amounted to more than
$120,000 in fiscal years 2018 and 2019.  The Wiederhorn Children Salaries were
material given these salaries were paid to the CEO’s children, and also because their
salaries amounted to approximately 4-5 percent of FAT’s revenue.
K. Ron Roe’s Role During the Relevant Period
1. Roe Approved the Wiederhorn Personal Cash Transfers and
the Thayer Transactions and Signed FAT’s 2017 Form 10-K
94. Prior to working at FAT as its Chief Financial Officer, Roe was
previously employed as FCCG’s CFO.
95. At FCCG, Roe routinely assisted Wiederhorn in sending funds from
FCCG’s accounts, or its subsidiaries Fatburger and Buffalo, to Wiederhorn, his
family, and his personal creditors.
96. After the FAT IPO, Roe continued this practice at FAT from October
2017 through December 2020, despite the fact that the Company had additional

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requirements to disclose related person transactions under Item 404.
97. Roe often approved and sent the transfers from FAT to Wiederhorn, his
family, or his creditors, including transfers that first passed through FCCG, and then
directed the FAT cash managers on how the transfers should be recorded in FAT and
FCCG’s accounting records.
98. Specifically, FAT’s cash managers reported to Roe, and he told the FAT
cash managers which transfers of FAT’s funds were for Wiederhorn’s personal
expenses, and how those transfers should be recorded in FAT and FCCG’s books.
99. Roe also instructed the FAT cash managers to use funds from FAT’s
accounts to pay Wiederhorn’s personal bank accounts, his credit card bills, and any of
his creditors at Wiederhorn’s request.
100. Roe also directed the FAT cash managers on how the Thayer
Transactions were recorded in FAT and FCCG’s accounting records.
101. From 2017 through 2019, Roe personally recorded, or directed FAT cash
managers how to record, the Thayer Transactions.
102. As FAT’s CEO, Roe signed FAT’s 2017 Form 10-K, which falsely and
misleadingly stated that FAT had disclosed all related person transactions.
103. Roe knew, or was reckless in not knowing, that the Thayer Transactions
exceeded $120,000 in fiscal year 2017 and were therefore related person transactions
that required disclosure, yet had not been properly disclosed.
2. Roe Was Aware of Wiederhorn’s False Representations to the
FAT Board
104. Given his role in recording Wiederhorn Personal Cash Transfers and the
Thayer Transactions, Roe knew, or was reckless in not knowing, that the funds FAT
transferred to FCCG were primarily being used by Wiederhorn to fund the
Wiederhorn Personal Cash Transfers for Wiederhorn’s personal benefit.
105. For example, Roe was included in the May 2019 and April 2020 email
communications, referenced supra in paragraphs 56 and 57, between Wiederhorn and

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the FAT Board, where Wiederhorn concealed that the funds FAT was sending to
FCCG were primarily being used for the Wiederhorn Personal Cash Transfers.
106. In another example, Roe also attended the FAT Board meetings in April
2020 where Wiederhorn falsely represented to the FAT Board that the purpose of
FAT’s loans to FCCG was to pay FCCG’s business expenses and FCCG’s creditors.
Roe was also a signatory of the Intercompany Agreement and attended the April 14,
2020 meeting wherein the FAT Board added an internal control requiring that any
additional lending to FCCG be approved in advance by the FAT Board.
107. Roe therefore also knew, or was reckless in not knowing, that
Wiederhorn made false and misleading statements to the FAT Board about the true
purpose of FAT lending millions in cash to FCCG and, despite being an executive
officer of FAT, did not take steps to correct those statements to the FAT Board.
L. Rebecca Hershinger’s Role During the Relevant Period
1. Hershinger Was Aware that Wiederhorn used the
Wiederhorn Personal Cash Transfers for His Personal Benefit
and Was Aware of the Wiederhorn Children Salaries
108. Hershinger succeeded Roe as FAT’s Chief Financial Officer.  As FAT’s
Chief Financial Officer from 2018 to 2021, Hershinger knew, or was reckless in not
knowing, that Wiederhorn was using substantial sums of FAT’s funds for his
personal spending and that Thayer was wiring millions of dollars into FAT.
109. For example, in October 2018, Hershinger circulated a ledger of FAT’s
loans to FCCG internally to Roe and others, which showed more than $1 million in
wires going from FAT directly into Wiederhorn's personal accounts, more than $3
million in wires in Thayer Transactions, and hundreds of thousands of dollars of
entries described as “AW AMEX.”
110. Similarly, in March 2019, Hershinger had communications with FAT’s
cash team that the Company was paying Wiederhorn’s personal credit cards using the
funds that FAT was loaning to FCCG.

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111. As another example, in May 2019, Hershinger circulated FCCG’s
December 2018 consolidating worksheets showing that Wiederhorn had received
over $9 million from FAT in 2018 alone.
112. Likewise, in May 2020, Hershinger personally performed an account
reconciliation of the money due from FCCG to FAT.  This reconciliation included her
analysis of FCCG’s bank accounts reflecting at least one million dollars in transfers
from FAT to FCCG, which were transferred to Wiederhorn’s personal bank accounts
in the form of Wiederhorn Personal Cash Transfers in the first quarter of 2020 alone.
113. Finally, as FAT’s CFO, Hershinger regularly reviewed FAT’s budgets
which reflected the Wiederhorn Children Salaries.  Accordingly, Hershinger knew, or
should have known, the Wiederhorn Children Salaries by early 2019 when she
reviewed FAT’s fiscal year 2018 documentation in preparing the Company’s 10-K.
114. Hershinger reviewed, approved, and signed FAT’s Form 10-Ks from
years 2018-2020.
115. Despite knowing, or being reckless in not knowing, that both the Thayer
Transactions and the Wiederhorn Children Salaries exceeded $120,000 in 2018 and
2019, and that the Wiederhorn Personal Cash Transfers exceeded $120,000 in 2018,
2019 and 2020, but none had been disclosed as related person transactions,
Hershinger signed FAT’s Form 10-Ks which falsely and misleadingly stated that
FAT had disclosed all related person transactions.
2. Hershinger Was Aware that Wiederhorn Made False
Representations to the FAT Board as well as on His Director
and Officer Questionnaires
116. In February 2019, Hershinger, in her role as Chief Financial Officer of
FAT, requested that Wiederhorn complete his director and officer questionnaire for
fiscal year 2018.  Wiederhorn then sent Hershinger the completed FAT’s director and
officer questionnaire in or around March 2019.
117. Wiederhorn’s completed questionnaire did not disclose that Wiederhorn

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had an interest in the transfers from FAT to FCCG, including that FAT was paying
his personal credit cards.  Instead, Wiederhorn’s signed questionnaire falsely stated
that neither Wiederhorn nor his family had a direct or indirect material interest in any
transaction or series of transactions to which FAT was a party and in which the dollar
amount exceeded $120,000.
118. Hershinger knew, or was reckless in not knowing, that Wiederhorn was
personally benefitting from the transfers from FAT to FCCG, and that Thayer was
wiring millions of dollars into FAT.   Yet in March 2020, Hershinger emailed
Wiederhorn a pre-completed questionnaire for FAT’s 2019 Form 10-K, which
contained the false answers from his 2018 questionnaire.
119. In addition, almost a year later in February 2021, Hershinger directed
FAT employees to transfer the answers from Wiederhorn’s 2019 questionnaire to
Wiederhorn’s 2020 questionnaire “exactly as presented.”
120. Like Roe, Hershinger attended the FAT Board meetings in April 2020
referenced supra in paragraphs 56 and 57 where Wiederhorn falsely represented to
the FAT Board that the purpose of the FAT’s loans to FCCG was to pay FCCG’s
business expenses and FCCG’s creditors.
121. Finally, Hershinger also attended the April 14, 2020 meeting wherein the
FAT Board added an internal control requiring that any additional lending to FCCG
be approved in advance by the FAT Board.  Given her role as CFO, her role in
performing the May 2020 account reconciliation, her role in preparing FAT's
financial statements which reflected the additional lending to FCCG in each quarter,
and the fact that she attended the FAT Board meetings where the Board placed
specific limits on the amounts Wiederhorn was permitted to lend to FCCG,
Hershinger was aware that Wiederhorn continued to lend money to FCCG in excess
of the amounts authorized by the FAT Board.
M. Wiederhorn, Roe, and Hershinger Lied to FAT’s Auditors
122. During the Relevant Period, FAT retained outside auditors to conduct

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annual audits and quarterly reviews.
123. Wiederhorn, Roe, and Hershinger made numerous false statements to
FAT’s auditors relating to the Wiederhorn Personal Cash Transfers, the Thayer
Transactions, and/or the Wiederhorn Children Salaries.
124. In February 2019, Wiederhorn signed and submitted to FAT’s auditors a
related party questionnaire falsely representing that neither he nor any of his
immediate family members had an interest in any transactions with the Company,
despite Wiederhorn knowing that he had an interest in FAT’s transfers from FAT to
FCCG and that his son Thayer had an interest in the Thayer Transactions.
125. During the 2019 audit of FAT, the Company’s auditor asked Wiederhorn
about the purpose of FAT paying his personal credit card.  In response, Wiederhorn
falsely stated to the auditor that FAT had paid his personal credit card because the
“charges were for [FCCG] expenses.”
126. Around this same time, Wiederhorn falsely stated to the auditor that
certain expenses identified as “AW Personal” were in fact FCCG business expenses.
127. In March 2020, in response to the auditor asking Wiederhorn about the
purpose of FAT loaning money to FCCG, Wiederhorn falsely told the auditor that the
purpose of the loans was to assist FCCG with paying ongoing and legacy liabilities
and business expenses.
128. Each year during the Relevant Period, in his role as the Company’s
CEO, Wiederhorn was required to sign annual management representation letters
directed to FAT’s auditors.
129. The management representation letters were relied on by the auditors in
rendering an opinion concerning the accuracy of FAT’s financial statements.
130. In these letters, Wiederhorn represented to FAT’s auditors that the
Company had made available “All financial records and related data, including names
of all related parties and all relationships and transactions with related parties.”
131. Wiederhorn also represented that “[w]e have disclosed to you the

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identity of [FAT]’s related parties and all information concerning related-party
relationships, transactions and amounts receivable from or payable to related parties
of which we are aware.”
132. Wiederhorn’s representations were materially false and misleading.
Despite representing that he had disclosed all related parties and all relationships and
transactions with related parties, Wiederhorn did not properly disclose his own
related party transactions with FAT, the fact that he was using FAT’s loans to FCCG
for his Wiederhorn Personal Cash Transfers, or the Thayer Transactions.
133. In addition, despite the fact that Wiederhorn was taking direct or indirect
loans from FAT in the form of personal loans that funded the Wiederhorn Personal
Cash Transfers, he falsely represented in pertinent part to FAT’s auditors in annual
management representation letters that the Company:
[H]as not, directly or indirectly, including through any subsidiary, extended or
maintained credit, arranged for the extension of credit or renewed an extension
of credit in the form of a personal loan to or for any director or executive officer.
134. Roe and Hershinger also reviewed, approved, signed, and certified the
false management representation letters during the Relevant Period as the respective
CFOs of the Company.
135. Roe co-signed and certified the 2017 management representation letter.
136. Hershinger co-signed and certified the 2018, 2019, and 2020
management representation letters.
137. The 2017 management letter contained false and misleading
representations and omitted material information because the Company had not
disclosed Wiederhorn’s direct or indirect material interest in the Wiederhorn Personal
Cash Transfers or the Thayer Transactions to the auditors.
138. The 2018 management letter contained false and misleading
representations and omitted material information because the Company had not
disclosed Wiederhorn’s direct or indirect material interest in the Wiederhorn Personal

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Cash Transfers or the Thayer Transactions to the auditors.
139. The 2019 management letter contained false and misleading
representations and omitted material information because the Company had not
disclosed Wiederhorn’s direct or indirect material interest in the Wiederhorn Personal
Cash Transfers or the Thayer Transactions to the auditors.
140. The 2020 management letter contained false and misleading
representations and omitted material information because the Company had not
disclosed Wiederhorn’s direct or indirect material interest in the Wiederhorn Personal
Cash Transfers or the Thayer Transactions to the auditors.
141. Roe made additional false statements to FAT’s auditors throughout the
Relevant Period.
142. In a March 2018 interview with FAT’s auditor, the auditor asked Roe to
identify all related parties with whom FAT had a transaction, a description of the
transactions, and the business purpose of those transactions.
143. Roe identified only FCCG and Buffalo as related parties with an interest
in transactions in which FAT was a participant.  Roe did not identify either
Wiederhorn or Thayer as related parties with interests in FAT’s transactions, even
though he assisted Wiederhorn with transferring FAT’s funds through the
Wiederhorn Personal Cash Transfers and after having personally reviewed and
recorded the Thayer Transactions in the Company’s accounting records.  By engaging
in this conduct, Roe assisted Wiederhorn in concealing the Wiederhorn Personal Cash
Transfers and the Thayer Transactions from FAT’s auditors.
144. In September and October 2020, Roe provided the auditor with a
purported loan agreement which he claimed represented that FCCG’s board of
directors had approved $25 million in loans from FCCG to Wiederhorn in January
2018.
145. However, Roe’s representation to the auditors was false because
FCCG’s board of directors were never aware of and did not approve either the loan

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agreement or the loans.
146. Hershinger also made additional false statements to FAT’s auditors
throughout the Relevant Period.
147. In 2019 and 2020, Hershinger represented to the Company’s auditors
that the Wiederhorn Children Salaries had “been disclosed in prior periods proxy
statements.”
148. These representations to the Company’s auditors in 2019 and 2020 were
not true because FAT did not report Wiederhorn Children Salaries as related person
transactions (or otherwise) until November 2020, when it filed its 2020 Schedule 14A
Proxy Statement.
N. FAT’s SEC Filings Contained Materially False and Misleading
Statements
149. As a public reporting company, FAT filed quarterly Forms 10-Q, annual
Forms 10-K, and annual Schedule 14A Proxy Statements with the SEC during the
Relevant Period.  In addition, FAT also conducted an offering in September 2019
pursuant to Regulation A and a separate offering in July 2020 pursuant to Form S-1.
150. FAT’s public filings during the Relevant Period contained numerous
false and misleading statements regarding (1) the Wiederhorn Personal Cash
Transfers, (2) the Thayer Transactions, (3) the Wiederhorn Children Salaries, and (4)
the Company’s use of investment and loan proceeds.
1. Materially False and Misleading Statements Regarding the
Wiederhorn Personal Cash Transfers and the Thayer
Transactions
151. FAT’s Forms 10-K contained false and misleading statements regarding
the Wiederhorn Personal Cash Transfers and the Thayer Transactions.
152. FAT’s 2017 Form 10-K represented that the company had “open
accounts with affiliated entities under the common control of FCCG resulting in net
amounts due to [FAT] of $7,963,000 as of December 31, 2017.”

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153. Apart from these transactions with FCCG, FAT’s 2017 Form 10-K
represented that: “there has not been, nor is there currently proposed, any transaction
or series of similar transactions to which [FAT] was or will be a party in which the
amount involved exceeds $120,000 and in which any director, executive officer,
shareholder who beneficially owns 5% or more of our common stock or any member
of their immediate family had or will have a direct or indirect material interest.”
154. FAT’s 2018 Schedule 14A Proxy Statement incorporated the disclosures
in FAT’s 2017 Form 10-K and represented that there were no reportable related
person transactions other than those described in FAT’s 2017 Form 10-K.
155. These affirmative statements in FAT’s 2017 Form 10-K and its 2018
Proxy Statement were materially false and misleading half-truths because neither
filing properly disclosed that: (i) Wiederhorn used more than $1 million of FAT
funds on Wiederhorn Personal Cash Transfers for his personal expenses between
October and December 2017; and (ii) the approximately $220,000 in Thayer
Transactions between October and December 2017.
156. FAT’s 2018 Form 10-K further represented that “Since January 1, 2018,
the Company has engaged in certain transactions with Fog Cutter Capital Group Inc.”
and had “open accounts with affiliated entities under the common control of FCCG
resulting net amounts due to the Company of $15,514,000.”
157. Apart from these transactions with FCCG, FAT’s 2018 Form 10-K also
represented that “there has not been, nor is there currently proposed, any transaction
or series of similar transactions to which [FAT] were or will be a party in which the
amount involved exceeds $120,000 and in which any director, executive officer,
shareholder who beneficially owns 5% or more of our common stock or any member
of their immediate family had or will have a direct or indirect material interest.”
158. FAT’s 2019 Schedule 14A Proxy Statement similarly identified related
person transactions between FAT and FCCG and further represented that “since the
beginning of the 2018 fiscal year” there were no reportable related person

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transactions, other than those described in FAT’s 2018 Form 10-K or the Proxy
Statement.
159. These affirmative statements in FAT’s 2018 Form 10-K and its 2019
Proxy Statement were materially false and misleading half-truths because neither
filing properly disclosed that Wiederhorn was the primary beneficiary of the loans
from FAT to FCCG and that Wiederhorn used almost $9 million of FAT funds on
Wiederhorn Personal Cash Transfers for his personal expenses between January and
December 2018.  Similarly, the Company’s 2018 10-K and 2019 Proxy Statement did
not properly disclose the approximately $5.5 million in Thayer Transactions between
January and December 2018.  Finally, the Company’s 2018 10-K and 2019 Proxy
Statement did not properly disclose the Wiederhorn Children Salaries from January to
December 2018.
160. FAT’s 2019 Form 10-K represented that “Since December 31, 2018, the
Company has engaged in certain transactions with Fog Cutter Capital Group Inc.”
and had “$25,967,000 net amounts due to the Company.”  Apart from these
transactions with FCCG, FAT also represented that “there has not been, nor is there
currently proposed, any transaction or series of similar transactions to which [FAT]
were or will be a party in which the amount involved exceeds $120,000 and in which
any director, executive officer, shareholder who beneficially owns 5% or more of our
common stock or any member of their immediate family had or will have a direct or
indirect material interest.”
161. FAT’s 2020 Schedule 14A Proxy Statement similarly identified related
person transactions between FAT and FCCG and further represented that “since the
beginning of the 2019 fiscal year” there were no reportable related person
transactions, other than those described in FAT’s 2019 Form 10-K or the Proxy
Statement.
162. These affirmative statements in FAT’s 2019 Form 10-K and its 2020
Proxy Statement were materially false and misleading half-truths because these

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filings did not properly disclose that Wiederhorn used about $7 million of FAT funds
on Wiederhorn Personal Cash Transfers for his personal expenses between January
and December 2019.  Similarly, the Company’s 2019 10-K and 2020 Proxy
Statement did not properly disclose the more than $3.5 million in Thayer
Transactions between January and December 2019.  Finally, the 2019 10-K did not
properly disclose the Wiederhorn Children Salaries from January to December 2019.
163. FAT’s 2020 Form 10-K represented that “Since December 29, 2019, the
Company has engaged in certain transactions with Fog Cutter Capital Group Inc,”
“the Company had previously extended credit to FCCG,” and “FCCG historically
made loan advances to Andrew A. Wiederhorn, its CEO and significant stockholder.”
Apart from these transactions, FAT further represented that “there has not been, nor
is there currently proposed, any transaction or series of similar transactions to which
[FAT] were or will be a party in which the amount involved exceeds $120,000 and in
which any director, executive officer, shareholder who beneficially owns 5% or more
of our common stock or any member of their immediate family had or will have a
direct or indirect material interest.”
164. These affirmative statements were materially false and misleading half-
truths because the 2020 10-K did not properly disclose that Wiederhorn had a direct
or indirect material interest in the loans to FCCG or that Wiederhorn used
approximately $9.6 million of FAT funds on Wiederhorn Personal Cash Transfers for
his personal expenses between January and December 2020.
2. Materially False and Misleading Statements Regarding Use of
Loan Proceeds and Proceeds from Securitization Notes
165. With approximately 40 percent of its revenue used by Wiederhorn to pay
his personal expenses through the Wiederhorn Personal Cash Transfers, FAT needed
financing from outside sources to fund its operations.
166. During the Relevant Period, FAT borrowed approximately $23.5 million
from “Fund I” and “Fund II” (“the Funds”), two outside investment funds

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incorporated in Delaware.
167. On January 29, 2019, FAT borrowed $20 million in loans from Fund I,
and on June 19, 2019, FAT borrowed an additional $3.5 million in loans from Fund II
(collectively, the “Fund Proceeds”).
168. The loan proceeds from Fund I were primarily used to pay off FAT’s
existing loans from outside lenders, leaving FAT with only about $1.7 million in
proceeds remaining.  Wiederhorn directed FAT’s cash team to transfer approximately
25 percent of these funds to pay his personal debts.  From Fund II, Wiederhorn
directed FAT’s cash team to wire $550,000 of the loan proceeds, about 16 percent of
the available proceeds, to an attorney to fund the settlement of a personal court
judgment against Wiederhorn that was unrelated to FAT’s business.
169. FAT’s 2018 and 2019 Forms 10-K, Q1-Q3 2019 Forms 10-Q, and
September 2019 Regulation A offering statement contained affirmative false and
misleading statements relating to FAT’s use of the Fund Proceeds.
170. For Fund I, FAT’s 2018 and 2019 Forms 10-K, Forms 10-Q for Q1-Q3
2019, and September 2019 Regulation A offering disclosed that FAT had “borrowed
$20 million [the Fund] and utilized the proceeds to repay the existing $16 million
term loan from FB Lending, LLC plus accrued interest and fees, and provide
additional general working capital to the Company.”
171. This affirmative statement was a materially false and misleading half-
truth because Wiederhorn had in fact used a substantial amount of the remaining
Fund Proceeds to pay down his personal debt.
172. Similarly, for Fund II, FAT’s 2019 Form 10-K, Forms 10-Q for Q2 and
Q3 2019, and FAT’s September 2019 Regulation A Offering Statement disclosed that
the Company borrowed an additional $3.5 million from Fund II in June 2019 to fund
the acquisition of another restaurant chain and to “acquire other assets and pay fees
and expenses of the transactions.”
173. This affirmative statement was a materially false and misleading half-

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truth because on the same day that FAT received the funds from Fund II, at
Wiederhorn’s direction, FAT had in fact wired approximately 16 percent of the Fund
Proceeds to pay his personal creditor.
174. In addition to the Fund Proceeds it received from the Funds, FAT raised
additional capital on March 6, 2020, by issuing notes pursuant to an asset-backed
securitization (the “Securitization Notes”).  The net proceeds from the issuance of
these Securitization Notes was $37,314,000.  FAT used $26,771,000 of these
proceeds to pay off its outstanding balance owed to the Funds.  The remaining
proceeds amounted to approximately $10.5 million.
175. On March 9, 2020, FAT sent approximately $2.8 million of the
remaining proceeds to FCCG, of which approximately $1.2 million was immediately
sent to Wiederhorn, his family, and his personal creditors as Wiederhorn Personal
Cash Transfers.
176. In its 2019 and 2020 Forms 10-K, Q1 through Q3 2020 Forms 10-Q, and
July 2020 Form S-1 Offering Statement, however, FAT disclosed the use of the
proceeds from the Securitization Notes as follows:
Net proceeds from the issuance of the Securitization Notes were $37,314,000 . .
.  A  portion  of  the  proceeds  from  the  Securitization  was  used  to  repay  the
remaining  $26,771,000  in  outstanding  balance  under  the  [Fund]  Loan  and
Security  Agreement.  The  remaining  proceeds  from  the  Securitization  will  be
used for working capital.
177. These affirmative statements were materially false and misleading half-
truths because, before this disclosure was made, approximately 27 percent of the
$10.5 million had been used for purposes other than for FAT’s “working capital,” and
approximately 12 percent was used for Wiederhorn Personal Cash Transfers.
3. Materially False and Misleading Statements Regarding the
Wiederhorn Children Salaries
178. FAT’s 2018 and 2019 Forms 10-K and FAT’s 2018 and 2019 Schedule

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14A Proxy Statements represented that apart from certain transactions with FCCG:
there has not been, nor is there currently proposed, any transaction or series of
similar transactions to which [FAT] were or will be a party in which the amount
involved  exceeds  $120,000  and  in  which  any  director,  executive  officer,
shareholder  who  beneficially  owns  5%  or  more  of  our  common  stock  or  any
member of their immediate family had or will have a direct or indirect material
interest.
179. These affirmative statements were materially false and misleading half-
truths because the Forms 10-K and Schedule 14A Proxy Statements did not disclose
the Wiederhorn Children Salaries.
4. Wiederhorn, Roe, and Hershinger Signed and Certified FAT’s
Public Filings
180. As the Chief Executive Officer FAT, Wiederhorn was responsible for
reviewing and approving the Company’s reports filed with the SEC.  In connection
with signing these reports, he signed certifications under the Sarbanes-Oxley Act of
2002, attesting that, among other things, each report “did not include any material
misstatements or omissions.”
181. As the Chief Financial Officer of FAT, Roe was responsible for
reviewing and approving the Company’s reports filed with the SEC.  In connection
with signing these reports, he signed a certification under the Sarbanes-Oxley Act of
2002, attesting that, among other things, each report “did not include any material
misstatements or omissions.”
182. As the Chief Financial Officer of FAT, Hershinger was responsible for
reviewing and approving the Company’s reports filed with the SEC.  In connection
with signing these reports, she signed certifications under the Sarbanes-Oxley Act of
2002, attesting that, among other things, each report “did not include any material
misstatements or omissions.”
183. Wiederhorn, as the Chief Executive Officer of FAT, reviewed, approved,
signed, and certified (1) each of FAT’s Forms 10-K for fiscal years 2017-2020, (2)

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each of FAT’s Forms 10-Q for Q1-Q3 2019 and Q1-Q3 2020, (3) the 2018-2020
Schedule 14A Proxy Statements, (4) the September 2019 Regulation A Offering
Statement, and (5) the July 2020 Form S-1 Offering Statement.  Wiederhorn was
therefore the maker of the false statements in these filings.
184. Roe, as the Chief Financial Officer of FAT, reviewed, approved, signed,
and certified the FAT Form 10-K for fiscal year 2017.  Roe was therefore the maker
of the false statements in this filing.
185. Hershinger, as the Chief Financial Officer of FAT, reviewed, approved,
signed, and certified the FAT Forms 10-K for fiscal years 2018-2020 and the
Company’s July 2020 Form S-1 Offering Statement.  Hershinger was therefore the
maker of the false statements in these filings.
O. Wiederhorn’s Fraudulent Schemes
186. From July 2018, when FAT reported that the FCCG Promissory Note
was almost fully paid back, until March 2021, Wiederhorn engaged in a scheme to
divert FAT’s cash to fund the Wiederhorn Personal Cash Transfers for his own
personal benefit while concealing these transfers from the FAT Board, FAT’s
auditors, and investors.  He executed this scheme by directing Roe and the FAT cash
managers to effectuate the Wiederhorn Personal Cash Transfers for his personal
benefit and by misleading the FAT Board and FAT’s auditors about the loans FAT
was making to FCCG.
187. In addition, between October 2017 and December 2019, Wiederhorn
engaged in a scheme to conceal FAT’s inability to pay its own bills by directing over
$9 million in Thayer Transactions.
188. Wiederhorn engaged in numerous deceptive acts to create false
appearances of fact to further his schemes, including:  not disclosing the Wiederhorn
Personal Cash Transfers or the Thayer Transactions in his director and officer
questionnaires and related party questionnaire, making false statements to the FAT
Board and FAT’s auditors about the purpose of the loans from FAT to FCCG; and

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disseminating false statements by signing FAT company filings containing false and
misleading representations about related person transactions.
189. Between July 2018 and December 2020, Roe substantially assisted
Wiederhorn with his scheme to divert FAT’s cash to fund the Wiederhorn Personal
Cash Transfers for his own personal benefit.  Between October 2017 and December
2019, Roe assisted Wiederhorn with his scheme to conceal FAT’s inability to pay its
own bills by directing over $9 million in Thayer Transactions.
190. Between October 2017 and December 2020, Roe oversaw the FAT cash
management team and directed to which of Wiederhorn’s accounts to send FAT
funds and effectuating many of the transfers himself.  Despite being an executive
officer of FAT and knowing all the details about the Wiederhorn transfers and the
Thayer Transactions, Roe did not inform the FAT Board when he knew, or was
reckless in not knowing, that Wiederhorn misled them about how the proceeds of
FAT’s loans to FCCG were being used. Roe also reviewed, revised, and signed
FAT’s 2017 Form 10-K thereby assisting Wiederhorn in disseminating false and
misleading statements which concealed Wiederhorn’s schemes.
P. FAT’s False and Misleading Statements and Wiederhorn’s
Fraudulent Schemes Were in Connection with the Offer or Sale of
Securities
191. Wiederhorn’s scheme and FAT’s false and misleading statements were
in connection with the offer or sale of securities.
192. Throughout the Relevant Period, while Wiederhorn engaged in his
fraudulent scheme, FAT’s shares were publicly traded on the NASDAQ, a public
stock exchange based in the United States.
193. On June 6, 2019, FAT filed a Form 1-A Regulation A Offering
Statement. The offering incorporated by reference the false and misleading
statements about related person transactions and use of proceeds made in FAT’s 2018
Form 10-K and Q2 2019 Form 10-Q filings and restated the false and misleading

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statements regarding the use of Lion Fund Proceeds. Through the offering, FAT
issued securities in the form of shares of FAT and raised proceeds from investors of
approximately $1,077,000.
194. On July 13, 2020, FAT filed a Form S-1 Registration statement and
amendments.  The offering statement incorporated by reference the false and
misleading statements about related person transactions made in FAT’s 2019 Form
10-K filing and restated the false and misleading statements about the use of proceeds
from the Securitization Notes. Through the offering, FAT issued securities in the
form of shares of FAT and raised proceeds from investors of $8,021,000.
Q. FAT’s False and Misleading Statements Were Material
195. The false and misleading statements regarding the Wiederhorn Personal
Cash Transfers, the Thayer Transactions, the Wiederhorn Children Salaries, and the
Use of Proceeds were material.
196. The approximately $26.7 million in FAT funds that Wiederhorn used to
fund the Wiederhorn Personal Cash Transfers from October 2017 through December
2020 amounted to approximately 44 percent of FAT’s total revenue during this
period.  The approximately $20 million FAT funds that Wiederhorn used to fund the
Wiederhorn Personal Cash Transfers from July 2018 through December 2020
amounted to approximately 40 percent of FAT’s total revenue during this period.
197. A reasonable investor would have considered it important that
Wiederhorn channeled almost half of FAT’s revenue to himself for his personal use.
198. Moreover, FAT’s board of directors would not have approved company
loans or transfers to FCCG during the Relevant Period if they had known that they
were funding Wiederhorn’s expenses personally.
199. The Thayer Transactions from October 2017 through December 2019
amounted to approximately 21 percent of FAT’s revenue during this period.
200. A reasonable investor would have considered it important that
Wiederhorn used millions in Thayer Transactions to conceal the fact that FAT was

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unable to pay its bills.
201. Similarly, the false and misleading statements regarding the Use of
Proceeds in 2019 and 2020 were material because a reasonable investor would have
found it important to know that FAT’s CEO was using FAT’s money for himself or
on his family and not using proceeds on “general working capital” or for the benefit
of the Company as represented in FAT’s SEC filings.
202. Finally, the false and misleading statements regarding the Wiederhorn
Children Salaries were material because a reasonable investor of FAT would have
found it important to know that the children of the CEO were earning at least a
quarter million dollars each in 2018 and 2019.
203. During this period, the Wiederhorn Children Salaries amounted to
between approximately 4 percent and 5 percent of FAT’s total revenue.
R. Wiederhorn, Roe, and Hershinger Acted with Scienter
204. During the Relevant Period, Wiederhorn acted with scienter.
Wiederhorn directed the Wiederhorn Personal Cash Transfers and the Thayer
Transactions to personally benefit from FAT’s funds.  He hid both the Wiederhorn
Personal Cash Transfers and the Thayer Transactions from the FAT Board, the
company’s auditors, and FAT’s investors.
205. Wiederhorn reviewed, edited, approved, and signed FAT’s Forms 10-Ks
and other company filings.  He therefore knew, or was reckless in not knowing, that
he disseminated the false statements contained in FAT’s Forms 10-Ks and other
company filings in furtherance of his scheme which misrepresented the Wiederhorn
Personal Cash Transfers and the Thayer Transactions.
206. Wiederhorn also misrepresented the purpose of FAT’s loans and
concealed the Wiederhorn Personal Cash Transfers from the FAT Board in both
email communications and statements made during meetings, as well as submitted
false and misleading questionnaires and management representation letters to the
Company’s auditors concealing both the Wiederhorn Personal Cash Transfers and

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Thayer Transactions.
207. As the CEO of FAT, Wiederhorn also knew of the Wiederhorn Children
Salaries, and yet did not disclose the Wiederhorn Children Salaries in the FAT Forms
10-K or Schedule 14A Proxy Statements for FY 2018 and 2019.
208. Wiederhorn’s conduct in connection with the Wiederhorn Personal Cash
Transfer, the Thayer Transactions, and the Wiederhorn Children Salaries was
unreasonable under the circumstances, and by engaging in that conduct, he also acted
negligently.
209. Roe also acted with scienter.  Throughout the Relevant Period, Roe
personally oversaw the FAT cash team and approved sending the Wiederhorn
Personal Cash Transfers from FAT’s company accounts for Wiederhorn’s benefit.
Roe also instructed the FAT cash managers to use funds from FAT’s accounts to pay
Wiederhorn’s personal credit card bills, and often paid the credit card bills himself
using FAT’s funds.  He also personally directed the FAT cash managers on the
Thayer Transactions.
210. During the Relevant Period, Roe also signed the FAT 2017 10-K which
he knew, or was reckless in not knowing, represented to FAT investors that FAT had
engaged in no reportable related person transactions with Wiederhorn or his
immediate family.  Roe also co-signed FAT’s 2017 management representation letter
with Wiederhorn which represented that all related party transactions had been
disclosed, despite knowing, or being reckless in not knowing, that neither he nor
Wiederhorn had disclosed that Wiederhorn was using FAT funds for the Wiederhorn
Personal Cash Transfers for his personal use, or the Thayer Transactions.  In May
2019 and April 2020, Roe, as an executive officer of FAT, was copied on emails
between Wiederhorn and FAT’s Board wherein Wiederhorn concealed that the
primary purpose of the lending from FAT to FCCG was to fund the Wiederhorn Cash
Transfers.  Roe knowingly or recklessly did not correct Wiederhorn’s representations
to the FAT board.

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211. Roe’s conduct in connection with the Wiederhorn Personal Cash
Transfers and the Thayer Transactions was unreasonable under the circumstances,
and by engaging in that conduct, he also acted negligently.
212. Hershinger also acted with scienter.  In both 2019 and 2020, Hershinger
accessed FAT’s loan ledger as well as FCCG’s loan ledger which reflected millions
of dollars in wires to Wiederhorn’s personal accounts.  In May 2019, she circulated
documents showing more than $9 million in Wiederhorn Personal Cash Transfers in
2018.  In addition, in March 2019, Hershinger had discussions with FAT’s controller
about the Company paying Wiederhorn’s personal credit cards for his personal
charges.  Hershinger also personally conducted a reconciliation analyzing banking
transactions reflecting more than $1 million in Wiederhorn Cash Transfers.
However, Hershinger signed the FAT 2019 and 2020 10-Ks which she knew, or was
reckless in not knowing, falsely represented to FAT investors that Wiederhorn was
not involved in any related person transactions.
213. Hershinger also received Wiederhorn’s responses to FAT’s director and
officer questionnaires in 2019 and 2020, which she knew or was reckless in not
knowing, misrepresented that Wiederhorn did not have a direct or indirect material
interest in any transactions over $120,000 in which FAT was a participant.  However,
Hershinger did not take any steps to correct Wiederhorn’s misrepresentations, despite
being the Chief Financial Officer of the company, and transferred his misleading
responses in subsequent questionnaires, knowing, or being reckless in not knowing,
they would be relied upon by the Company for purposes of preparing its Forms 10-K
and proxy statement filings.
214. Hershinger’s conduct in connection with the Wiederhorn Personal Cash
Transfers was unreasonable under the circumstances, and by engaging in that
conduct, she also acted negligently.
215. During the Relevant Period, Wiederhorn was a corporate officer acting
as an agent for FAT within the scope of his employment.  Therefore, his intent can be

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imputed to FAT.
216. During the Relevant Period, Roe was a corporate officer acting as an
agent for FAT within the scope of his employment.  Therefore, his intent can be
imputed to FAT.
217. During the Relevant Period, Hershinger was a corporate officer acting as
an agent for FAT within the scope of her employment.  Therefore, her intent can be
imputed to FAT.
S. FAT’s Books and Records Were Inaccurate and the Company
Failed to Maintain a Sufficient Internal Accounting Controls
218. FAT failed to make and keep books and records that accurately reflected
the reportable related person transactions.  Specifically, FAT failed to track and
report its own CEO’s direct or indirect material interest in the Company was sending
to FCCG, an affiliate company.
219.
Wiederhorn made false and misleading statements in his director and
officer questionnaires about reportable related person transactions that would
have allowed FAT to accurately track and report those transactions.

220. In addition, despite FAT’s auditor notifying the FAT Board of an
internal control deficiency relating to Wiederhorn having complete control over
FAT’s accounts in early 2020, FAT did not devise or maintain an internal accounting
control system that provided reasonable assurance that access to assets was consistent
with addressing this deficiency.  Despite the FAT Board devising a control on April
14, 2020 which required FAT Board advance approval for any additional lending to
FCCG be approved in advance by the FAT Board, Wiederhorn authorized loan
amounts from FAT to FCCG beyond the limits approved by the FAT Board.  As a
result, during the second quarter, the third quarter, and the fourth quarter of 2020,
Wiederhorn lent FAT money to FCCG far in excess of the FAT Board-approved
amounts.
221. Wiederhorn, as FAT’s CEO, knew or was reckless in not knowing that

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FAT failed to track, report, and disclose reportable related person transactions, that he
could transfer money from FAT at his own discretion, and that he made false
statements to the FAT Board at April 2020 meetings regarding the purpose of the
FAT loans to FCCG.  Wiederhorn was also aware that the FAT Board included a
control on April 14, 2020 requiring that any additional lending to FCCG be approved
in advance by the FAT Board, and that he authorized loan amounts from FAT to
FCCG beyond the limits approved by the FAT Board.  In addition, Wiederhorn
signed director and officer questionnaires that made false and misleading statements
about reportable related person transactions that would have allowed FAT to
accurately track and report these transactions.
222. Roe, as FAT’s CFO and SVP of finance, knew or was reckless in not
knowing that FAT failed to track, report, and disclose reportable related person
transactions, that Wiederhorn could transfer money from FAT at his own discretion,
and that Wiederhorn made false statements to the FAT Board at April 2020 meetings
regarding the purpose of the FAT loans to FCCG.  Roe was a signatory of the
Intercompany Agreement and attended the April 14, 2020 meeting wherein the FAT
Board added an internal control requiring that any additional lending to FCCG be
approved in advance by the FAT Board.  However, Roe did not take any steps take
any steps to implement an internal accounting control system that prevented
Wiederhorn from circumventing or violating the FAT Board’s internal control,
despite being aware that Wiederhorn authorized loan amounts from FAT to FCCG
beyond the limits approved by the FAT Board.
223. Hershinger, as FAT’s CFO, knew or was reckless in not knowing that
FAT failed to track, report, and disclose reportable related person transactions, that
Wiederhorn could transfer money from FAT at his own discretion, and that
Wiederhorn made false statements to the FAT Board at April 2020 meetings
regarding the purpose of the FAT loans to FCCG.  Hershinger attended the April 14,
2020 meeting wherein the FAT Board added an internal control requiring that any

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additional lending to FCCG be approved in advance by the FAT Board.  However,
Hershinger did not take any steps to implement an internal accounting control system
that prevented Wiederhorn from circumventing or violating the FAT Board’s internal
control, despite being aware that Wiederhorn authorized loan amounts from FAT to
FCCG beyond the limits approved by the FAT Board.
224. Hershinger was also aware that Wiederhorn signed director and officer
questionnaires that made false and misleading statements about reportable related
person transactions that would have allowed FAT to accurately track and report these
transactions.
T. The Statutory Period Has Been Tolled
225. FAT, Wiederhorn, and Roe executed tolling agreements suspending the
period for one year and sixty days.
226. Hershinger executed tolling agreements in 2023 and 2024 suspending
the period for five months and sixty days.
FIRST CLAIM FOR RELIEF
Fraud in Connection with the Purchase or Sale of Securities
Violations of Exchange Act Section 10(b) and Rules 10b-5(a) and (c) Thereunder
(against Wiederhorn)
227. The SEC realleges and incorporates by reference paragraphs 1 through
226 above.
228. As alleged above, Wiederhorn engaged in a scheme to defraud between
July 2018 and March 2021 by, among other things, directing Roe and the FAT cash
managers to effectuate the Wiederhorn Personal Cash Transfers for his personal
benefit and misleading the FAT Board, FAT’s auditors, and investors about the loans
FAT was making to FCCG.
229. As alleged above, Wiederhorn also engaged in a scheme to defraud
between October 2017 and December 2019 by directing the Thayer Transactions,
which alleviated and disguised FAT’s inability to pay its own bills.

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230. Wiederhorn engaged in deceptive acts to create the false appearance of
fact to further his schemes by not disclosing the Wiederhorn Personal Cash Transfers
or the Thayer Transactions in his director and officer questionnaires and related party
questionnaire and by lying to the FAT Board about the purpose of the loans from
FAT to FCCG.  Wiederhorn also disseminated false statements by signing FAT
company filings containing false and misleading representations about related person
transactions.
231. By engaging in the conduct described above, Defendant Wiederhorn,
directly or indirectly, acting with scienter, by use of the means or instrumentalities of
interstate commerce, or of the mails, or of a facility of a national securities exchange,
in connection with the purchase or sale of a security: employed devices, schemes or
artifices to defraud; or engaged in acts, practices, or courses of business which
operated or would operate as a fraud or deceit upon another person.
232. By engaging in the conduct described above, Defendant Wiederhorn,
directly or indirectly, violated, and unless restrained and enjoined, will again violate,
Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5(a) and (c)
thereunder [17 C.F.R. § 240.10b-5(a) and (c)].
SECOND CLAIM FOR RELIEF
Fraud in Connection with the Offer and Sale of Securities
Violations of Securities Act Section 17(a)(1) and (3) of the Securities Act
(against Wiederhorn)
233. The SEC realleges and incorporates by reference paragraphs 1 through
226 above.
234. As alleged above, Wiederhorn engaged in a scheme to defraud between
July 2018 and March 2021 by, among other things, directing Roe and the FAT cash
managers to effectuate the Wiederhorn Personal Cash Transfers for his personal
benefit and misleading the FAT Board, FAT’s auditors, and investors about the loans
FAT was making to FCCG.

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235. As alleged above, Wiederhorn also engaged in a scheme to defraud
between October 2017 and December 2019 by directing the Thayer Transactions,
which alleviated and disguised FAT’s inability to pay its own bills.
236. Wiederhorn engaged in deceptive acts to create the false appearance of
fact to further his schemes by not disclosing the Wiederhorn Personal Cash Transfers
or the Thayer Transactions in his director and officer questionnaires and related party
questionnaire and by lying to the FAT Board about the purpose of the loans from
FAT to FCCG.  Wiederhorn also disseminated false statements by signing FAT
company filings containing false and misleading representations about related person
transactions.
237. In connection with the scheme, Wiederhorn realized ill-gotten gains in
the form of Wiederhorn Personal Transfers funded by loans from FAT which were
never repaid.
238. At all relevant times and as alleged above, Wiederhorn acted with
scienter, or in the alternative, was negligent.
239. By engaging in the conduct described above, Defendant Wiederhorn,
directly or indirectly, in the offer or sale of securities by the use of means or
instruments of transportation or communication in interstate commerce or by use of
the mails employed devices, schemes, or artifices to defraud; or engaged in
transactions, practices, or courses of business which operated or would operate as a
fraud or deceit upon the purchaser.
240. By engaging in the conduct described above, Defendant Wiederhorn
violated, and unless restrained and enjoined will continue to violate, Sections 17(a)(1)
and 17(a)(3) of the Securities Act, 15 U.S.C. §§ 77q(a)(1) & 77q(a)(3).
///
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///
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THIRD CLAIM FOR RELIEF
Aiding and Abetting Wiederhorn’s Violations of Exchange Act Section 10(b) and
Rules 10b-5(a) and (c) Thereunder and Securities Act Sections 17(a)(1) and (3)
(against Roe)
241. The SEC realleges and incorporates by reference paragraphs 1 through
226 above.
242. As alleged above, from October 2017 to December 2020, Roe
substantially assisted Wiederhorn’s scheme by, among other things, overseeing the
FAT cash management team and directing to which of Wiederhorn’s accounts to send
FAT funds and effectuating many of the transfers himself.  Despite being an
executive officer of FAT, and knowing all the details about the Wiederhorn transfers
and the Thayer Transactions, Roe did not inform the FAT Board when he knew, or
was reckless in not knowing, that Wiederhorn misled them about how the proceeds of
FAT’s loans to FCCG were being used. Roe also reviewed, revised, and signed
FAT’s 2017 Form 10-K, thereby substantially assisting Wiederhorn in disseminating
false and misleading statements which concealed Wiederhorn’s scheme.
243. By engaging in the conduct described above, Defendant Roe knowingly
and recklessly provided substantial assistance to, and thereby aided and abetted
Wiederhorn in his violations of Section 10(b) of the Exchange Act [15 U.S.C. §
78j(b)] and Rules 10b-5(a) and (c) thereunder [17 C.F.R. § 240.10b-5(a) and (c)] and
Sections 17(a)(1) and 17(a)(3) of the Securities Act, 15 U.S.C. §§ 77q(a)(1) &
77q(a)(3).
244. Unless restrained and enjoined, Roe is reasonably likely to continue to
aid and abet, violations of Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)]
and Rules 10b-5(a) and (c) thereunder [17 C.F.R. § 240.10b-5(a) and (c)] and
Sections 17(a)(1) and 17(a)(3) of the Securities Act, 15 U.S.C. §§ 77q(a)(1) &
77q(a)(3).
///

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FOURTH CLAIM FOR RELIEF
Materially False or Misleading Statements
in Connection With the Purchase or Sale of Securities
Violation of Section 10(b) and Rule 10b-5(b) Thereunder
(against Wiederhorn, FAT, Roe, and Hershinger)
245. The SEC realleges and incorporates by reference paragraphs 1 through
226 above.
246. As alleged above, among other filings, Wiederhorn made (1) affirmative
false and misleading statements regarding related person transactions in connection
with the Thayer Transactions in FAT’s Forms 10-K for fiscal years 2017 through
2019; (2) affirmative false and misleading statements regarding related person
transactions in connection with the Wiederhorn Personal Cash Transfers in FAT’s
Forms 10-K for fiscal years 2017 through 2020; and (3) affirmative false and
misleading statements regarding the use of proceeds in FAT’s Forms 10-K for fiscal
years 2018, 2019, and 2020, and Forms 10-Q for Q1, Q2, and Q3 2029, and Q1, Q2,
and Q3 2020.  Wiederhorn signed each of these company filings.
247. As alleged above, Roe made affirmative false and misleading statements
in FAT’s 2017 Form 10-K regarding related person transactions in connection with
the Thayer Transactions.  Roe signed this filing.
248. As alleged above, Hershinger made affirmative false and misleading
statements regarding related person transactions in connection with the Wiederhorn
Personal Cash Transfers and Thayer Transactions in FAT’s 2019 Form 10-K and its
July 2020 Form S-1 Registration Statement that incorporated the relevant section of
the 2019 Form 10-K by reference, and regarding the Wiederhorn Cash Transfers in
FAT’s 2020 Form 10-K.  Hershinger signed each of these filings.
249. As set forth above, these affirmative false and misleading statements
were material and made in connection with the purchase or sale of securities.
250. Wiederhorn, Roe, and Hershinger made these statements with scienter

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because they knew, or were reckless in not knowing, that the representations
regarding related person transactions were false and misleading.
251. Wiederhorn’s, Roe’s, and Hershinger’s scienter is imputed to FAT, of
which they were acting as its CEO or CFOs, respectively.
252. By engaging in the conduct described above, Defendants Wiederhorn,
Roe, Hershinger, and FAT directly or indirectly, in the offer or sale of securities, and
by the use of means or instruments of transportation or communication in interstate
commerce or by use of the mails directly or indirectly, made an untrue statement of
material fact or omitted to state a material fact necessary in order to make the
statements made, in light of the circumstances in which they were made, not
misleading.
253. By engaging in the conduct described above, Defendants Wiederhorn,
Roe, Hershinger, and FAT violated, and unless restrained and enjoined will continue
to violate, Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b), and Rule 10b-5(b)
thereunder, 17 C.F.R. §§ 240.10b-5(b).
FIFTH CLAIM FOR RELIEF
Materially False or Misleading Statements
in Connection With the Offer and Sale of Securities
Violation of Section 17(a)(2) of the Securities Act
(against FAT)
254. The SEC realleges and incorporates by reference paragraphs 1 through
226 above.
255. As alleged above, among other filings, FAT’s (1)  Forms 10-K for fiscal
years 2017 through 2019 contained affirmative false and misleading statements
regarding related person transactions in connection with the Thayer Transactions; (2)
Forms 10-K for fiscal years 2017 through 2020 contained affirmative false and
misleading statements regarding related person transactions in connection with the
Wiederhorn Personal Cash Transfers; and (3) Forms 10-K for fiscal years 2018-2020

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and Forms 10-Q for Q1-Q3 2019 and Q1-Q3 2020 contained affirmative false and
misleading statements regarding the use of proceeds.
256. These affirmative false and misleading statements were made or
incorporated by reference in FAT’s September 2019 Regulation A offering and July
2020 Form S-1 offering and were therefore in connection with the offer or sale of
securities. Through these false and misleading statements, FAT received
approximately $1,077,000 in proceeds through its September 2019 offering pursuant
to Regulation A, and approximately $8,021,000 through its July 2020 offering
pursuant to Form S-1.
257. As set forth above, these false and misleading statements were material
and made in connection with the offer or sale of securities.
258. Wiederhorn signed each of these company filings.  Wiederhorn made
these statements with scienter, or at least negligence, because he knew, or were
reckless in not knowing, that the representations regarding related person transactions
and use of proceeds were false and misleading.
259. Hershinger signed the Company’s July 2020 Form S-1 Registration
Statement while knowing, being reckless in not knowing, or being at least negligent,
that the Form S-1 contained materially false statements regarding related person
transactions.
260. Wiederhorn’s and Hershinger’s scienter and/or negligence are imputed
to FAT, as they were acting as the Company’s CEO and CFO, respectively.
261. By engaging in the conduct described above, Defendant FAT directly or
indirectly, in the offer or sale of securities by the use of means or instruments of
transportation or communication in interstate commerce or by use of the mails,
obtained money or property by means of untrue statements of a material fact or by
omitting to state a material fact necessary in order to make the statements made, in
light of the circumstances under which they were made, not misleading.
262. By engaging in the conduct described above, Defendant FAT violated,

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and unless restrained and enjoined will continue to violate, Section 17(a)(2) of the
Securities Act, 15 U.S.C. §§ 77q(a)(2).
SIXTH CLAIM FOR RELIEF
Aiding and Abetting FAT’s Violation of Section 17(a)(2) of the Securities Act
(against Wiederhorn and Hershinger)
263. The SEC realleges and incorporates by reference paragraphs 1 through
226 above.
264. As alleged above, Wiederhorn substantially assisted FAT’s violation of
Section 17(a)(2) by signing the Company’s 2019 offering document pursuant to
Regulation A and its July 2020 offering document pursuant to Form S-1 while
knowing that the documents contained, or incorporated by reference, materially false
and misleading statements regarding related person transactions and/or the use of
proceeds.
265. As alleged above, Hershinger also substantially assisted FAT’s violation
of Section 17(a)(2) by signing the Company’s July 2020 Form S-1 Registration
Statement, while knowing, or being reckless in not knowing, that the Form S-1
contained materially false statements regarding related person transactions and/or the
use of proceeds.
266. By engaging in the conduct described above, Defendants Wiederhorn
and Hershinger knowingly or recklessly provided substantial assistance to, and
thereby aided and abetted FAT in its violation of Section 17(a)(2) of the Securities
Act, 15 U.S.C. §§ 77q(a)(2).
267. By engaging in the conduct described above, Defendants Wiederhorn
and Hershinger aided and abetted, and unless restrained and enjoined, is reasonably
likely to continue to aid and abet, violations of Section 17(a)(2) of the Securities Act,
15 U.S.C. §§ 77q(a)(2).
///
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SEVENTH CLAIM FOR RELIEF
False Statements to Accountants
Violation of Rule 13b2-2 of the Exchange Act
(against Wiederhorn, Roe, and Hershinger)
268. The SEC realleges and incorporates by reference paragraphs 1 through
226 above.
269. As alleged above, Wiederhorn knowingly made false statements in the
related party questionnaire he signed and provided to FAT’s auditors in connection
with the 2018 audit. In addition, Wiederhorn, Roe, and Hershinger all signed
representation letters falsely stating that all information concerning related-party
relationships had been disclosed despite knowing, or recklessly not knowing, about
the Wiederhorn transfers or the Thayer Transactions, and, for Hershinger and
Wiederhorn, the Wiederhorn Children salaries.
270. Wiederhorn also knowingly (1) falsely told FAT’s 2019 auditor that
expenses Wiederhorn initially identified in as “AW personal” were instead FCCG
business expenses; (2) falsely told FAT’s 2019 auditor that FCCG used the loans
from FAT to FCCG to pay legacy liabilities and business expenses; and (3) any
payments by FAT of Wiederhorn’s personal credit card charges were because the
amounts due were business expenses of FCCG.
271. As alleged above, Roe knowingly misled FAT’s auditors in connection
with the 2017 Company audit regarding the Thayer Transactions and Wiederhorn
Personal Cash Transfers by identifying only FCCG as a related person to FAT in
interviews.  In September and October 2020, Roe also made false representations to
FCCG’s auditors regarding documents which he misrepresented evidenced that
FCCG’s board of directors had fully approved loans from FCCG to Wiederhorn,
which were never approved by the FCCG board.
272. Hershinger knowingly told the auditors that the Wiederhorn Children
Salaries had already been disclosed when, in fact, they had not.

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273. By engaging in the conduct described above, Defendants Wiederhorn,
Roe, and Hershinger, directly or indirectly:  (1) made or caused to be made a
materially false and misleading statement to an accountant in connection with:  (i)
any audit, review or examination of the financial statements of the issuer required to
be made under the federal securities laws; or (ii) the preparation or filing of any
document or report required to be filed with the SEC; or (2) omitted to state, or
caused another person to omit to state, any material fact necessary in order to make
statements made, in light of the circumstances under which such statements were
made, not misleading, to an accountant in connection with:  (i) any audit, review or
examination of the financial statements of the issuer required to be made under the
federal securities laws; or (ii) the preparation or filing of any document or report
required to be filed with the SEC.
274. By engaging in the conduct described above, Defendants Wiederhorn,
Roe, and Hershinger violated, and unless restrained and enjoined will continue to
violate Rule 13b2-2 of the Exchange Act, 17 C.F.R. § 240.13b2-2.
EIGHTH CLAIM FOR RELIEF
False Sarbanes-Oxley Certification
Violation of Rule 13a-14 of the Exchange Act
(against Wiederhorn, Roe, and Hershinger)
275. The SEC realleges and incorporates by reference paragraphs 1 through
226 above.
276. As alleged above, Wiederhorn, as the Chief Executive Officer of FAT,
reviewed, approved, signed, and certified each of FAT’s Forms 10-K for fiscal years
2017-2020 and each of FAT’s Forms 10-Q for Q1-Q4 2019 and Q1-Q3 2020.  Roe,
as the Chief Financial Officer of FAT, reviewed, approved, signed, and certified the
FAT Form 10-K for fiscal year 2017.  Hershinger, as the Chief Financial Officer of
FAT, reviewed, approved, signed, and certified the FAT Form 10-Ks for fiscal years
2018-2020.

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277. These certifications were false because these filings contained material
misrepresentations and omissions about related person transactions and/or the use of
proceeds.
278. By engaging in the conduct described above, Defendants Wiederhorn,
Roe, and Hershinger falsely certified periodic reports containing financial statements
filed by an issuer in violation of Section 13(a) of the Exchange Act and Rule 13a-14
thereunder.
279. By engaging in the conduct described above, Defendants Wiederhorn,
Roe, and Hershinger violated, and unless restrained and enjoined will continue to
violate, Rule 13a-14 of the Exchange Act, 17 C.F.R. § 240.13a-14.
NINTH CLAIM FOR RELIEF
False SEC Filings
Violations of Section 13(a) of the Exchange Act and
Rules 12b-20, 13a-1 and 13a-13 Thereunder
(against FAT)
280. The SEC realleges and incorporates by reference paragraphs 1 through
226 above.
281. As alleged above supra in Section N of this Complaint, FAT, which was
an issuer of securities registered pursuant to Section 12 of the Exchange Act, filed
annual Forms 10-K and quarterly Forms 10-Q containing misrepresentations and
omissions about related person transactions and/or the use of proceeds.
282. By doing so, FAT filed materially false and misleading quarterly reports,
and materially false and misleading annual reports with the SEC that made untrue
statements of material fact or omitted to state material facts necessary in order to
make the statements made, in light of the circumstances under which they were made,
not misleading, in violation of Section 13(a) of the Exchange Act and Rules 12b-20,
13a-1, and 13a-13.
283. By engaging in the conduct described above, Defendant FAT violated,

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and unless restrained and enjoined will continue to violate, Section 13(a) of the
Exchange Act and Rules 12b-20, 13a-1, and 13a-13.
TENTH CLAIM FOR RELIEF
Aiding and Abetting FAT’s Violations of Section 13(a) of the Exchange Act and
Rules 12b-20, 13a-1 and 13a-13 Thereunder
(against Wiederhorn)
Rules 12b-20 and 13a-1 Thereunder
(against Roe and Hershinger)
284. The SEC realleges and incorporates by reference paragraphs 1 through
226 above.
285. As alleged above, Wiederhorn, Roe, and Hershinger substantially
assisted FAT’s primary violations by signing certain Company filings during the
Relevant Period. Wiederhorn signed FAT’s Forms 10-K for fiscal years 2017-2020.
Roe signed the 2017 Form 10-K, and Hershinger signed the Forms 10-K for fiscal
years 2018, 2019, and 2020.
286. As alleged above, Wiederhorn signed each of FAT’s Forms 10-Q for
Q1-Q3 2019 and Q1-Q3 2020.
287. Each of the defendants knew or was reckless in not knowing that the
filings they signed contained false and misleading statements about FAT’s related
person transactions and/or the use of proceeds.
288. By engaging in the conduct described above, Defendants Wiederhorn,
Roe, and Hershinger each aided and abetted the reporting violations of FAT in that
they knowingly or recklessly provided substantial assistance to FAT in committing
these reporting violations.
289. By engaging in the conduct described above, Defendant Wiederhorn
aided and abetted FAT’s violations of, and, unless restrained and enjoined, will again
aid and abet, violations of Section 13(a) of the Exchange Act and Rules 12b-20, 13a-
1 and 13a-13 thereunder.

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290. By engaging in the conduct described above, Defendants Roe and
Hershinger aided and abetted FAT’s violations of Section 13(a) of the Exchange Act
and Rules 12b-20 and 13a-1 thereunder.
291. Unless restrained and enjoined, Defendants Roe and Hershinger are
reasonably likely to again aid and abet, violations of Section 13(a) of the Exchange
Act and Rules 12b-20 and 13a-1 thereunder.
ELEVENTH CLAIM FOR RELIEF
Failure to Maintain Accurate Books and Records
Violation of 13(b)(2)(A) of the Exchange Act
(against FAT, and Wiederhorn, Roe, and Hershinger for Aiding and Abetting)
292. The SEC realleges and incorporates by reference paragraphs 1 through
226 above.
293. As alleged above, FAT failed to make and keep books and records that
accurately reflected the reportable related person transactions and failed to track and
report Wiederhorn’s direct or indirect material interest in the loans from FAT to
FCCG.
294. As alleged above, Wiederhorn, Roe, and Hershinger aided and abetted
FAT’s violations by failing to maintain accurate books and records in tracking
reportable related person transactions and failing to ensure that FAT’s loans to FCCG
were made with proper approvals.
295. By the date of FAT’s Form 2017 10-K, Wiederhorn knew or was
reckless in not knowing that FAT had failed to track, report, and disclose reportable
related person transactions relating to the Wiederhorn Personal Cash Transfers and
the Thayer Transactions.  Wiederhorn substantially assisted FAT’s violations by,
among other things, signing director and officer questionnaires and a related party
questionnaire that made false and misleading statements about reportable related
person transactions that would have allowed FAT to accurately track and report such
transactions.

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296. By the date of FAT’s Form 2017 10-K, Roe knew that Wiederhorn was
using most of the money FAT transferred to FCCG for the Wiederhorn Personal Cash
Transfers and also knew that the Thayer Transactions amounted to over $120,000 for
2017.  Roe substantially assisted FAT’s violations by, among other things, concealing
the Wiederhorn Personal Cash Transfers and the Thayer Transactions as related party
transactions during interviews with the auditors, as well as concealing the true
purpose of those transactions.  In addition, Roe failed to disclose to auditors in
management representation letters that the Wiederhorn Personal cash Transfers and
the Thayer Transactions were related party transactions.
297. By May 2019, Hershinger knew that Wiederhorn was using FAT’s loans
to FCCG on his personal expenses.  She substantially assisted FAT’s violations by,
among other things, accepting Wiederhorn’s representations in his director and
officer questionnaires for fiscal years 2019 and 2020 when she knew, or was reckless
in not knowing, that those representations were false and misleading.
298. By engaging in the conduct described above, FAT violated, and unless
restrained and enjoined, will continue to violate Section 13(b)(2)(A) of the Exchange
Act, 15 U.S.C. § 78m(b)(2)(A).
299. By engaging in the conduct described above, Defendants Wiederhorn,
Roe, and Hershinger knowingly and recklessly provided substantial assistance to, and
thereby aided and abetted FAT in its violations of Section 13(b)(2)(A) of the
Exchange Act, and unless restrained and enjoined, is reasonably likely to continue to
aid and abet violations of Section 13(b)(2)(A) of the Exchange Act, 15 U.S.C. §
78m(b)(2)(A).
TWELFTH CLAIM FOR RELIEF
Failure to Devise a System of Internal Accounting Controls
Violation of 13(b)(2)(B) of the Exchange Act
(against FAT, and Wiederhorn, Roe, and Hershinger for Aiding and Abetting)
300. The SEC realleges and incorporates by reference paragraphs 1 through

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226 above.
301. As alleged above, FAT failed to maintain a system of internal
accounting controls sufficient to provide reasonable assurances that access to assets
was consistent with management authorization.  The Company allowed Wiederhorn
to have complete control over FAT’s accounts and to direct the transfers to the cash
team, often without Board authorization.
302. Wiederhorn, Hershinger, and Roe aided and abetted FAT’s violation by
failing to devise and maintain an internal accounting control system to ensure FAT
tracked reportable related person transactions and failing to ensure that FAT’s loans
to FCCG were made with proper approvals.
303. Beginning in or around May 2019 until December 2020, Wiederhorn
knowingly or recklessly misled the FAT Board by representing that the loans from
FAT to FCCG were solely for FCCG’s business expenses.  Wiederhorn also signed
officer and director questionnaires that contained false and misleading statements
about reportable related person transactions that would have allowed the Company to
accurately track and report those transactions.
304. Similarly, Roe and Hershinger knew or were reckless in not knowing
that FAT failed to track, report, and disclose reportable related person transactions
relating to Wiederhorn’s ability to transfer money from FAT at his sole discretion and
his concealment of the Wiederhorn Personal Cash Transfers from the FAT Board.
For Roe, despite managing the FAT cash management team and his integral role in
recording FAT’s loans to FCCG, he failed to track, report, and disclose the
Wiederhorn Personal Cash Transactions and Thayer Transactions.  Hershinger
substantially assisted FAT’s violations by accepting Wiederhorn’s representations in
his officer and director questionnaires for fiscal years 2019 and 2020 when she knew
that they were false and misleading.  Moreover, despite knowing about the
Wiederhorn Personal Cash Transfers and Thayer Transactions during this period, she
failed to ensure that these transactions were tracked, reported and disclosed as

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reportable related person transactions.
305. By engaging in the conduct described above, FAT violated, and unless
restrained and enjoined will continue to violate, Section 13(b)(2)(B) of the Exchange
Act, 15 U.S.C. § 78m(b)(2)(B).
306. By engaging in the conduct described above, Defendants Wiederhorn,
Hershinger, and Roe knowingly and recklessly provided substantial assistance to, and
thereby aided and abetted FAT’s violation of Section 13(b)(2)(B) of the Exchange
Act, and unless restrained and enjoined, is reasonably likely to continue to aid and
abet violations of Section 13(b)(2)(B) of the Exchange Act, 15 U.S.C. §
78m(b)(2)(B).
THIRTEENTH CLAIM FOR RELIEF
Circumventing Internal Controls
Violation of Section 13(b)(5) of the Exchange Act
(against Wiederhorn)
307. The SEC realleges and incorporates by reference paragraphs 1 through
226 above.
308. As alleged above, Wiederhorn violated Section 13(b)(5) during the
second, third, and fourth quarters of 2020.  In April 2020, after learning that
Wiederhorn could lend FAT’s money to FCCG “at no limit without board approval,”
FAT’s Board put controls in place by requiring advance board approval for any
additional lending by FAT to FCCG. Wiederhorn ignored and circumvented this
control and continued to lend FAT money to FCCG in the second, third, and fourth
quarters of 2020 in excess of the amounts approved by FAT’s Board.
309. As alleged above, Wiederhorn personally benefitted from this
unauthorized lending through the Wiederhorn Personal Cash Transfers.
310. By engaging in the conduct described above, Wiederhorn violated, and
unless restrained and enjoined, is reasonably likely to continue to violate, Section
13(b)(5) of the Exchange Act, 15 U.S.C. § 78m(b)(5).

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FOURTEENTH CLAIM FOR RELIEF
Falsifying Books and Records
Violation of Rule 13b2-1 of the Exchange Act
(against Wiederhorn)
311. The SEC realleges and incorporates by reference paragraphs 1 through
226 above.
312.
As alleged above, Wiederhorn violated Rule 13b2-1 by signing
director and officer questionnaires that made false and misleading statements
about reportable related person transactions that would have allowed FAT to
accurately track and report those transactions.

313. By engaging in the conduct described above, Wiederhorn violated, and
unless restrained and enjoined, is reasonably likely to continue to violate, Exchange
Act Rule 13b2-1, 17 C.F.R. § 240.13b2-1.
FIFTEENTH CLAIM FOR RELIEF
Solicitation of Proxies in Violation of Rules and Regulations
Violation of Section 14(a) of the Exchange Act and
Rules 14a-3 and 14a-9 Thereunder
(against FAT and Wiederhorn)
314. The SEC realleges and incorporates by reference paragraphs 1 through
226 above.
315. As alleged above, FAT’s proxy statements that it used to solicit proxies
in connection with its 2018 through 2020 annual meetings for the election of
directors, including Wiederhorn in 2020, contained false and misleading statements
regarding FAT’s reportable related person transactions with Wiederhorn and Thayer.
316. In addition, FAT’s proxy statements for 2018 and 2019, contained false
and misleading statements regarding the Wiederhorn Personal Cash Transfers and
Thayer Transactions, as well as the Wiederhorn Children Salaries.
317. Wiederhorn signed these proxy statements despite knowing they

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contained false and misleading statements.
318. By engaging in this conduct, Wiederhorn acted at least negligently.
319. As FAT’s founder, CEO, and director, Wiederhorn is directly liable for
FAT’s proxy violations.
320. By engaging in the conduct described above, Defendants FAT and
Wiederhorn violated, and unless restrained and enjoined, are reasonably likely to
continue to violate, Section 14(a) of the Exchange Act, 15 U.S.C. § 78n(a) and Rules
14a-3and 14a-9 thereunder, 17 C.F.R. §§ 240.14a-3 and 14a-9.
SIXTEENTH CLAIM FOR RELIEF
Improper Personal Loans to FAT’s CEO
Violation of Section 13(k) of the Exchange Act
(against FAT, and Wiederhorn and Roe For Aiding and Abetting)
321. The SEC realleges and incorporates by reference paragraphs 1 through
226 above.
322. As alleged above, from July 2018 to December 2020, Wiederhorn
directed approximately $20 million from FAT to FCCG which were used for the
Wiederhorn Personal Cash Transfers.  Wiederhorn used these funds to pay for private
jets, first class airfare, luxury vacations, his rent and mortgage payments, shopping,
and jewelry.
323. The Wiederhorn Personal Cash Transfers were direct or indirect personal
loans from FAT to Wiederhorn.
324. Wiederhorn and Roe aided and abetted FAT’s violation.  Wiederhorn
directed FAT’s cash team for each transaction between FAT and either FCCG or
Wiederhorn that funded the Wiederhorn Personal Cash Transfers, and he knew that
the transactions were for his personal benefit.  Roe similarly ensured Wiederhorn’s
instructions were followed and trained the FAT cash team on using the FAT loans to
fund the Wiederhorn Personal Cash Transfers.
325. By engaging in the conduct described above, FAT violated, and unless

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restrained and enjoined will continue to violate, Section 13(k) of the Exchange Act,
15 U.S.C. § 78m(k).
326. By engaging in the conduct described above, Defendants Wiederhorn
and Roe knowingly and recklessly provided substantial assistance to, and thereby
aided and abetted FAT’s violation of Section 13(k) of the Exchange Act, and unless
restrained and enjoined, are reasonably likely to continue to aid and abet violations of
Section 13(k) of the Exchange Act, 15 U.S.C. § 78m(k).
PRAYER FOR RELIEF
WHEREFORE, the SEC respectfully requests that the Court:
I.
Issue findings of fact and conclusions of law that Defendants committed the
alleged violations.
II.
Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of
Civil Procedure, permanently enjoining FAT and its officers, agents, servants,
employees and attorneys, and those persons in active concert or participation with
any of them, who receive actual notice of the judgment by personal service or
otherwise, and each of them, from violating Section 17(a)(2) of the Securities Act,
Sections 10(b), 13(a), 13(b)(2)(A), 13(b)(2)(B), 13(k), and 14(a) of the Exchange
Act, and Rules 10b-5(b), 12b-20, 13a-1, 13a-13, 14a-3, and 14a-9 thereunder.
III.
Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of
Civil Procedure, permanently enjoining Wiederhorn and his officers, agents, servants,
employees and attorneys, and those persons in active concert or participation with
any of them, who receive actual notice of the judgment by personal service or
otherwise, and each of them, from violating 17(a)(1) and 17(a)(3) of the Securities
Act, 10(b), 13(b)(5), and 14(a) of the Exchange Act, and Rules 10b-5, 13a-14, 13b2-
1, 13b2-2, 14a-3 and 14a-9 thereunder; and aiding and abetting violations of

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Securities Act Section 17(a)(2), Exchange Act Sections 13(a), 13(b)(2)(A),
13(b)(2)(B), and 13(k) and Rules 12b-20, 13a-1, and 13a-13 thereunder.
IV.
Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of
Civil Procedure, permanently enjoining Roe and his officers, agents, servants,
employees and attorneys, and those persons in active concert or participation with
any of them, who receive actual notice of the judgment by personal service or
otherwise, and each of them, from violating Section 10(b) of the Exchange Act and
Rules 10b-5(b), 13a-14, and 13b2-2 thereunder; aiding and abetting Wiederhorn’s
primary violations of Securities Act Sections 17(a)(1) and (3), and Exchange Act
Section 10(b) and Rules 10b-5(a) and (c) thereunder; and aiding and abetting
violations of Exchange Act Sections 13(a), 13(b)(2)(A), 13(b)(2)(B), 13(k), and Rules
12b-20 and 13a-1 thereunder.
V.
Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of
Civil Procedure, permanently enjoining Hershinger and her officers, agents, servants,
employees and attorneys, and those persons in active concert or participation with
any of them, who receive actual notice of the judgment by personal service or
otherwise, and each of them, from violating Section 10(b) of the Exchange Act and
Rules 10b-5(b), 13a-14, and 13b2-2 thereunder; and aiding and abetting violations of
Section 17(a)(2) of the Securities Act and Sections 13(a), 13(b)(2)(A) and
13(b)(2)(B) of the Exchange Act, and Rules 12b-20 and 13a-1 thereunder.
VI.
Issue an order, pursuant to Section 20(e) of the Securities Act, 15 U.S.C. §
77t(e), and Sections 21(d)(2) of the Exchange Act, 15 U.S.C. § 78u(d)(2), prohibiting
Wiederhorn, Roe, and Hershinger from acting as an officer or director of any issuer
that has a class of securities registered pursuant to Section 12 of the Exchange Act, 15
U.S.C. § 78l, or that is required to file reports pursuant to Section 15(d) of the

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Exchange Act, 15 U.S.C. § 78o(d).
VII.
Order Defendants FAT and Wiederhorn to disgorge all funds received from
their illegal conduct, together with prejudgment interest thereon.
VIII.
Order Defendants to pay civil penalties under Section 20(d) of the Securities
Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the Exchange Act [15 U.S.C. §
78u(d)(3)].
IX.
Retain jurisdiction of this action in accordance with the principles of equity and
the Federal Rules of Civil Procedure in order to implement and carry out the terms of
all orders and decrees that may be entered, or to entertain any suitable application or
motion for additional relief within the jurisdiction of this Court.
X.
Grant such other and further relief as this Court may determine to be just and
necessary.
Jury Demand

The SEC demands trial by jury on liability.

Dated:  May 10, 2024
 /s/ Stephen T. Kam
Stephen T. Kam
Robert C. Stillwell
Attorneys for Plaintiff
Securities and Exchan
ge Commission

Complaints and Other Initiating Documents
2:24-cv-03913 Securities and Exchange Commission v. FAT Brands, Inc. et al
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
Notice of Electronic Filing
The following transaction was entered by Kam, Stephen on 5/10/2024 at 4:25 AM PDT and filed on 5/10/2024
Case Name:Securities and Exchange Commission v. FAT Brands, Inc. et al
Case Number:2:24-cv-03913
Filer:Securities and Exchange Commission
Document Number:1
Docket Text:
COMPLAINT No Fee Required - US Government, filed by Plaintiff Securities and Exchange
Commission. (Attorney Stephen Tian Li Kam added to party Securities and Exchange
Commission(pty:pla))(Kam, Stephen)
2:24-cv-03913 Notice has been electronically mailed to:
Stephen Tian Li Kam     [email protected], [email protected], [email protected], [email protected],
[email protected], [email protected]
2:24-cv-03913 Notice has been delivered by First Class U. S. Mail or by other means BY THE FILER to :
The following document(s) are associated with this transaction:
Document description:Main Document
Original filename:C:\fakepath\FAT Complaint FINAL.pdf
Electronic document Stamp:
[STAMP cacdStamp_ID=1020290914 [Date=5/10/2024] [FileNumber=37901201-0
] [41c32e75cebe39763cb38a89bd0f1fdcc2e255b20258ae9764398c4924346872c69
234ee4faecba4a416507a632d325f901b56b3cb5872f5b6c1cc8f679507e7]]

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STEPHEN T. KAM (Cal. Bar No. 327576) 
Email:  [email protected] 
ROBERT C. STILLWELL (Cal. Bar No. 308630) 
Email: [email protected] 
 
Attorneys for Plaintiff 
Securities and Exchange Commission 
Katharine E. Zoladz, Regional Director 
Gary Y. Leung, Associate Regional Director 
Douglas M. Miller, Regional Trial Counsel 
444 S. Flower Street, Suite 900 
Los Angeles, California 90071 
Telephone: (323) 965-3998 
Facsimile: (213) 443-1904 

UNITED STATES DISTRICT COURT 

CENTRAL DISTRICT OF CALIFORNIA 

 

SECURITIES AND EXCHANGE 
COMMISSION, 

Plaintiff, 
 

vs. 

FAT BRANDS INC., ANDREW 
WIEDERHORN, RON ROE, and 
REBECCA HERSHINGER, 

Defendants. 
 

 Case No.   
 
 
COMPLAINT 
 
 
 
DEMAND FOR JURY TRIAL 
 

 
 
 

Case 2:24-cv-03913   Document 1   Filed 05/10/24   Page 1 of 59   Page ID #:1



 

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Plaintiff Securities and Exchange Commission (“SEC”) alleges: 

JURISDICTION AND VENUE 

1. The Court has jurisdiction over this action pursuant to Sections 20(b), 

20(d)(1) and 22(a) of the Securities Act of 1933 (“Securities Act”), 15 U.S.C. §§ 

77t(b), 77t(d)(1) & 77v(a), and Sections 21(d)(1), 21(d)(3)(A), 21(e) and 27(a) of the 

Securities Exchange Act of 1934 (“Exchange Act”), 15 U.S.C. §§ 78u(d)(1), 

78u(d)(3)(A), 78u(e) & 78aa(a). 

2. Defendants have, directly or indirectly, made use of the means or 

instrumentalities of interstate commerce, of the mails, or of the facilities of a national 

securities exchange in connection with the transactions, acts, practices and courses of 

business alleged in this complaint.  

3. Venue is proper in this district pursuant to Section 22(a) of the Securities 

Act, 15 U.S.C. § 77v(a), and Section 27(a) of the Exchange Act, 15 U.S.C. § 78aa(a), 

because certain of the transactions, acts, practices and courses of conduct constituting 

violations of the federal securities laws occurred within this district.  In addition, 

venue is proper in this district because Defendants Andrew Wiederhorn, Ron Roe, 

and Rebecca Hershinger reside in this district, and Defendant FAT Brands Inc. has its 

principal place of business in this district. 

SUMMARY 

4. Between October 2017 and March 2021 (the “Relevant Period”), 

Andrew Wiederhorn (“Wiederhorn”), the former chief executive officer and current 

director and controlling shareholder of FAT Brands Inc. (“FAT” or the “Company”) 

used almost $27 million of FAT’s cash on his personal expenses including private 

jets, first class airfare, luxury vacations, his rent and mortgage payments, shopping, 

and jewelry.  During this time, Wiederhorn falsely told the Company’s auditors, 

board of directors, and investors that neither he nor his family members had any 

direct or indirect material interest in the FAT cash that Wiederhorn used for those 

personal expenditures.   

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5. Between July 2018 and March 2021, Wiederhorn engaged in deceptive 

acts and made false and misleading statements to make it appear that the millions of 

dollars of FAT’s money he was spending on himself and on his family each year 

were company loans to FAT’s affiliate Fog Cutter Capital Group, Inc. (“FCCG”), 

another company that Wiederhorn controlled, for FCCG’s business expenses.  

Wiederhorn used his control over FCCG to take the money that FCCG was receiving 

from FAT and spend it on himself.  Wiederhorn then misled FAT’s board of directors 

(the “FAT Board”) and the Company’s auditors, leading them to believe that FCCG 

was using the proceeds from FAT’s loans solely for FCCG’s business expenses and 

pre-existing liabilities. 

6. Although this fraudulent scheme allowed Wiederhorn to hide from the 

FAT Board, the Company’s auditors, and investors the fact that he was spending 

FAT’s cash to fund his lavish lifestyle, it stripped FAT of approximately 40 percent 

of its revenue during the Relevant Period, often leaving the Company with 

insufficient cash to pay its own bills.  Between 2017 and 2019, Wiederhorn instructed 

his son to wire over $9 million into FAT, concealing that Wiederhorn used millions 

of FAT’s funds for his own personal spending and that FAT was otherwise unable to 

pay its own bills.   

7. Wiederhorn enlisted the help of Ron Roe (“Roe”), the Company’s 

former chief financial officer (“CFO”) and current senior vice president (“SVP”) of 

finance and executive officer to execute his scheme.  Roe used his position at the 

Company to send FAT funds to Wiederhorn, Wiederhorn’s family, or Wiederhorn’s 

creditors.  Both Roe and Rebecca Hershinger (“Hershinger”), another former CFO at 

FAT, personally signed, certified, and disseminated false and misleading statements 

that failed to properly disclose Wiederhorn’s personal interest in these transactions.   

8. By engaging in this conduct:  (i) FAT violated Section 17(a)(2) of the 

Securities Act of 1933 (“Securities Act”), Sections 10(b), 13(a), 13(b)(2)(A), 

13(b)(2)(B), 13(k), and 14(a) of the Securities Exchange Act of 1934 (“Exchange 

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Act”) and Rules 10b-5(b), 12b-20, 13a-1, 13a-13, 14a-3, and 14a-9 thereunder; (ii) 

Wiederhorn violated Sections 17(a)(1) and (3) of the Securities Act, Sections 10(b), 

13(b)(5), and 14(a) of the Exchange Act and Rules 10b-5, 13a-14, 13b2-1, 13b2-2, 

14a-3 and 14a-9 thereunder; and aided and abetted FAT’s primary violations of 

Section 17(a)(2) of the Securities Act, Sections 13(a), 13(b)(2)(A), 13(b)(2)(B), and 

13(k) of the Exchange Act and Rules 12b-20, 13a-1, and 13a-13 thereunder; (iii) Roe 

violated Section 10(b) of the Exchange Act and Rules 10b-5(b), 13a-14, and 13b2-2 

thereunder; aided and abetted Wiederhorn’s primary violations of Sections 17(a)(1) 

and (3) of the Securities Act, and Section 10(b) of the Exchange Act and Rules 10b-

5(a) and (c) thereunder; and aided and abetted FAT’s primary violations of Sections 

13(a), 13(b)(2)(A), 13(b)(2)(B), and 13(k) of the Exchange Act and Rules 12b-20 and 

13a-1 thereunder; and (iv) Hershinger violated Section 10(b) of the Exchange Act and 

Rules 10b-5(b), 13a-14, and 13b2-2 thereunder; and aided and abetted FAT’s primary 

violations of Section 17(a)(2) of the Securities Act and Sections 13(a), 13(b)(2)(A), 

13(b)(2)(B) of the Exchange Act and Rules 12b-20 and 13a-1 thereunder. 

9. The SEC requests that the Court impose permanent injunctions against 

each of the Defendants for their respective violations of the federal securities laws, 

and bar Wiederhorn, Roe, and Hershinger from acting as an officer or director of a 

public issuer pursuant to Section 21(d)(2) of the Exchange Act.  The SEC requests 

that the Court order FAT and Wiederhorn to disgorge their ill-gotten gains with 

prejudgment interest thereon.  The SEC requests that the Court assess civil money 

penalties against FAT, Wiederhorn, Roe, and Hershinger, pursuant to Sections 

21(d)(3) of the Exchange Act and 20(d) of the Securities Act. 

DEFENDANTS 

10. FAT Brands Inc. is a Delaware corporation with its principal place of 

business in Beverly Hills, California.  FAT owns 17 restaurant brands, including 

Fatburger, Johnny Rockets, and Twin Peaks.  During the Relevant Period, FAT was a 

reporting company with its securities registered with the SEC pursuant to Section 12 

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of the Exchange Act.  During the Relevant Period, FAT filed annual Forms 10-K and 

quarterly Forms 10-Q.  During the Relevant Period, FAT conducted an offering 

pursuant to Regulation A in September 2019 and an offering pursuant to Form S-1 in 

July 2020.   

11. Andrew Wiederhorn, age 58, is a resident of Beverly Hills, California. 

During the Relevant Period, Mr. Wiederhorn served as FAT’s and FCCG’s chief 

executive officers at all relevant times.  In 2004, Wiederhorn pleaded guilty to two 

federal felony criminal charges for paying an illegal gratuity and filing a false tax 

return.  Wiederhorn served 14 months in prison. 

12. Ron Roe, age 46, is a resident of Los Angeles, California. Roe served as 

FAT’s CFO from October 20, 2017 through August 16, 2018, and SVP of finance, 

from August 2018 through the present.   

13. Rebecca Hershinger, age 50, is a resident of Los Angeles, California. 

Hershinger was FAT’s CFO from August 16, 2018 through May 31, 2021. 

RELATED PARTIES 

14. Fog Cutter Capital Group, Inc. was, until it merged with FAT on 

December 24, 2020, a Maryland corporation with a principal place of business in 

Oregon.  FCCG had been listed on NASDAQ until 2004, when it was delisted for 

conduct involving improper payments to Wiederhorn.  During the Relevant Period, 

Wiederhorn was FCCG’s Chief Executive Officer and owned between 30 and 45 

percent of its shares.  Wiederhorn and his family collectively owned about 60 percent 

of FCCG’s shares during that same period, and FCCG, in turn, owned at least 80 

percent of FAT’s shares.  

15. Thayer Wiederhorn (“Thayer”), age 35, is a resident of Los Angeles, 

California.  Thayer is currently Chief Operating Officer of FAT and was Chief 

Marketing Officer during the relevant period.  Thayer is Andrew Wiederhorn’s son.   

///  

/// 

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THE ALLEGATIONS 

A. Wiederhorn Created FCCG and Later Formed FAT as Its 

Subsidiary 

16. Wiederhorn formed FCCG in 1998. 

17. In 2017, Wiederhorn formed FAT as a wholly owned subsidiary of 

FCCG, with FCCG owning 80 percent FAT’s shares.    

18. During the Relevant Period, Wiederhorn held approximately 40 percent 

of FCCG’s shares and served as the chief executive officer (“CEO”) of both FAT and 

FCCG. 

19. Wiederhorn controlled both FAT and FCCG, including directing, 

authorizing and approving all wires, transfers and bill payments to and from both 

FAT’s and FCCG’s accounts. 

20. Wiederhorn’s annual salary as CEO of FAT, according to the 

Company’s public filings, was $400,000. 

21. On October 20, 2017, FAT conducted an initial public offering (“IPO”).  

Following the IPO, FAT was required to make certain disclosures in its SEC filings 

as a reporting company with securities registered with the SEC pursuant to Section 12 

of the Exchange Act. 

22. At the time of the IPO, FCCG had just two revenue-generating 

businesses: the restaurant chains Fatburger North America, Inc. (“Fatburger”) and 

Buffalo’s Franchise Concepts, Inc. (“Buffalo”). 

23. FCCG transferred ownership of Fatburger and Buffalo to FAT in 

connection with the IPO, leaving FCCG with essentially no revenue and no business 

operations.  FCCG continued to hold as an asset approximately $100 million in net 

operating losses that could be made available to FAT under certain conditions to 

reduce the Company’s tax liabilities. 

24. In exchange for these two businesses, FAT issued a $30 million 

promissory note (the “FCCG Promissory Note”) to FCCG.  

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25. Ron Roe, the chief financial officer (“CFO”) of FCCG, became the CFO 

of FAT in connection with the IPO and served in that position until August 2018.  

The cash management team that Roe oversaw at FCCG transferred to FAT in 

connection with the IPO.   

26. In August 2018, Hershinger took over as the CFO of FAT and served in 

that position until May 2021. 

B. As a Reporting Company, FAT Was Required to Disclose Related 

Person Transactions  

27. During the Relevant Period, Regulation S-K Items 404 (a) and (d) (“Item 

404”) required FAT, as a reporting company, to describe in certain SEC filings, 

including in the Company’s Forms 10-K and proxy statements, any transaction, or 

series of similar transactions in which FAT was a participant and the amount 

involved exceeded $120,000, and in which any related person—including any 

director or executive officer of FAT and any immediate family member of a direct or 

executive officer—had or will have a direct or indirect material interest.  These 

transactions are commonly referred to as related person transactions. 

28. For any related person transactions, Item 404 required FAT in certain 

SEC filings to describe, among other things:  the name of the related person and the 

basis on which the person is a related person; the related person’s interest in the 

transaction; the dollar amount involved in the transaction; the dollar value of the 

related person’s interest in the transaction; and any other information regarding the 

transaction or the related person in the context of the transaction that is material to 

investors in light of the circumstances of the particular transaction. 

C. Wiederhorn’s Direct or Indirect Interest in Certain FAT 

Transactions 

29. From October 2017 through December 2020, FAT’s revenue was 

approximately $61 million.  During this time, Wiederhorn directed approximately 

$38 million in FAT transfers to FCCG.   

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30. Between October 2017 and in or about July 2018, the majority of the 

funds that FAT transferred to FCCG were in repayment of the $30 million FCCG 

Promissory Note.  By July 2018, the remaining balance due under the note was less 

than $1 million, which FAT publicly reported it had fully paid back by September 

2018.  

31. Wiederhorn, however, directed FAT to continue transferring millions of 

dollars to FCCG, even after the FCCG Promissory Note was fully paid back, through 

what the company disclosed as intercompany lending from FAT to FCCG.   

32. Wiederhorn had a direct or indirect material interest in the funds 

transferred to FCCG because he borrowed a substantial portion of those funds from 

FCCG and used those funds for his personal expenses, his family, and his personal 

creditors (the “Wiederhorn Personal Cash Transfers”).   

33. From July 2018 through December 2020, FAT’s revenue was 

approximately $51.5 million.  During this time, Wiederhorn directed FAT to loan 

approximately $28.3 million of FAT’s funds to FCCG as intercompany loans, 

approximately $20 million of which he then used to fund Wiederhorn Personal Cash 

Transfers.   

34. The Wiederhorn Personal Cash Transfers were either direct transfers 

from FAT’s company accounts to Wiederhorn’s personal accounts, his family, or his 

creditors, or they were indirect transfers that first passed through FCCG’s bank 

accounts before being sent to Wiederhorn’s personal accounts, his family, or his 

creditors.  

35. In either case, the Wiederhorn Personal Cash Transfers benefitted 

Wiederhorn personally, not FAT or FCCG.  Wiederhorn used these transfers to pay 

off his personal credit cards.  These transfers included payments for private jets, first 

class airfare, luxury vacations, Wiederhorn’s mortgage and rent payments, and nearly 

$700,000 in shopping and jewelry.   

36. Wiederhorn was responsible for directing the transfers from FAT that 

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funded Wiederhorn Personal Cash Transfers.  He required FAT’s cash managers to 

prepare daily “cash reports” reflecting all of the funds in FAT’s, FCCG’s, and 

Wiederhorn’s personal bank accounts, and met with the cash managers on an almost 

daily basis to direct them as to which of his, or his creditors’, accounts the 

Wiederhorn Personal Cash Transfers should be sent, and whether the transfers should 

first pass through FCCG’s accounts.  The FAT cash managers followed Wiederhorn’s 

direction as to how much and to which accounts FAT would send money.   

37. From July 2018 through December 2020, the Wiederhorn Personal Cash 

Transfers were recorded by FAT as intercompany loans to FCCG, even when the 

funds were intended solely for Wiederhorn’s personal use and even though, in many 

instances, the funds never even passed through FCCG’s accounts.   

38. Between October 2017 and December 2020, the Wiederhorn Personal 

Cash Transfers were never disclosed as related party transactions to FAT investors in 

the Company’s public filings. 

39. The Wiederhorn Personal Cash Transfers were never repaid and were 

written off by FCCG at Wiederhorn’s discretion in 2020. 

D. The Thayer Transactions Concealed FAT’s Inability to Pay its Own 

Bills  

40. In 2017, the Wiederhorn Personal Cash Transfers totaled approximately 

$1.1 million, which was approximately 50 percent of FAT’s revenue during that year.   

41. In 2018, the Wiederhorn Personal Cash Transfers totaled approximately 

$9 million, which was approximately 49 percent of FAT’s revenue during that year.   

42. In 2019, the Wiederhorn Personal Cash Transfers totaled more than $7 

million, which was approximately 31 percent of FAT’s revenue during that year.   

43. In 2020, the Wiederhorn Personal Cash Transfers totaled approximately 

$9.6 million, which was approximately 53 percent of FAT’s revenue during that year.   

44. From October 2017 through December 2020, the Wiederhorn Personal 

Cash Transfers totaled approximately 44 percent of FAT’s revenue over that 

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timeframe. 

45. The Wiederhorn Personal Cash Transfers stripped FAT of cash to pay its 

own bills.   

46. Therefore, Wiederhorn instructed his son Thayer to transfer millions of 

dollars in cash to FAT, because the Company’s accounts were frequently short on 

cash and the Company was unable to pay its bills (the “Thayer Transactions”).  To 

effectuate these transactions, Wiederhorn sent funds to Thayer’s personal accounts 

using credit cards that were paid for by FAT.  Thayer would then transfer the funds 

he received from Wiederhorn into specific FAT accounts as instructed by 

Wiederhorn.    

47. The Thayer Transactions were used when FAT needed cash to pay its 

bills and expenses, including, among other things, its payroll and concealed the fact 

that FAT was frequently short on cash. 

48. From 2017 through 2019, the Thayer Transactions amounted to over $9 

million sent to FAT’s bank accounts.   

49. In 2017, the Thayer Transactions totaled approximately $220,000, which 

was approximately 10 percent of FAT’s revenue during that year.   

50. In 2018, the Thayer Transactions totaled approximately $5.5 million, 

which was approximately 30 percent of FAT’s revenue during that year.   

51. In 2019, the Thayer Transactions totaled approximately $3.5 million, 

which was approximately 16 percent of FAT’s revenue during that year.   

52. Wiederhorn directed the Thayer Transactions and directed the FAT cash 

management team on how the wires were to be accounted for in FAT’s books. 

53. The Thayer Transactions were never publicly disclosed as related person 

transactions to the Company’s investors.   

E. Wiederhorn Concealed the Nature of the Wiederhorn Personal Cash 

Transfers and the Thayer Transactions  

54. Wiederhorn concealed from FAT’s Board that the purpose of the loans 

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from FAT to FCCG were to fund the Wiederhorn Personal Cash Transfers and to 

benefit himself personally.  Due to this concealment, and the control that Wiederhorn 

had over FAT as its CEO, he was able to carry out his fraudulent scheme for years.   

55. Wiederhorn misrepresented to FAT’s Board that the loans from FAT to 

FCCG were for FCCG’s business expenses.   

56. For example, in May 2019, Wiederhorn sent email communications to 

FAT’s Board representing that the loans were “for FCCG to pay [its] various tax and 

legal settlements and other obligations.”   

57. Similarly, in April 2020 emails with the FAT Board, Wiederhorn 

represented that “funds at [FCCG] are used to pay pre-existing pre-IPO liabilities.”  

Wiederhorn made similar statements at FAT board meetings in April 2020, telling the 

FAT Board that the loans were used solely for FCCG’s business expenses and 

concealing that they were primarily used for his personal benefit. 

58. In addition, for fiscal years 2018 through 2020, Wiederhorn completed 

annual director and officer questionnaires as the CEO of FAT that were submitted to 

the Company’s auditors.  The stated purpose of the questionnaires, in pertinent part 

was to provide FAT:  

[W]ith information to be used in connection with preparation of the Company’s 
[] Annual Report on Form 10-K to be filed with the U.S. Securities and Exchange 
Commission [] and the Company’s Proxy Statement for its [] Annual Meeting 
of Stockholders. 

59. The questionnaires instructed that Wiederhorn disclose whether he or 

any immediate family member had: 

[A]ny material interest, direct or indirect, in any transaction or series of similar 
transactions or proposed transaction or proposed series of similar transactions to 
which the Company or any of its subsidiaries was or is to be a party, and in which 
the amount involved exceeds $120,000.   

60. Wiederhorn answered “no” to this question despite knowing that he had 

a direct or indirect material interest in the transfers from FAT to FCCG that funded 

the Wiederhorn Personal Cash Transfers, knowing Thayer (Wiederhorn’s immediate 

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family) had a direct or indirect material interest in the Thayer Transactions between 

2017 and 2019, and the fact that one or both of these series of transactions exceeded 

$120,000 each year from 2018 through 2020.   

61. Similarly, the questionnaires asked whether Wiederhorn:  

Had received at any time during the previous 24 months, or do you currently 
have outstanding any loan or extension of credit in the form of a personal loan 
from the Company or any of its affiliates? 

62. Despite FCCG being an affiliate of FAT, Wiederhorn always answered 

“no” to that question and did not disclose that he was taking funds in the form of 

personal loans from FCCG to fund the Wiederhorn Personal Cash Transfers each 

year.  Moreover, the Wiederhorn Personal Cash Transfers were a direct or indirect 

extension of credit in the form of personal loans from FAT to Wiederhorn, the 

Company’s CEO.   

63. By engaging in this conduct, Wiederhorn furthered his scheme by 

creating a false appearance that the funds that FAT was sending to FCCG were being 

used solely for business purposes and that the Company had sufficient cash on hand 

to pay its bills.   

F. Wiederhorn Violated the Internal Controls Implemented by the 

FAT Board  

64. During the course of FAT’s 2019 audit, FAT’s auditor advised the 

Company’s audit committee of a “significant deficiency” in FAT’s internal control 

over financial reporting.  Specifically, in early 2020, FAT’s auditor identified that 

“The CEO has the ability to transfer funds for parent company advances at no limit 

without board approval” and that there was a “lack of sufficient controls around the 

financial reporting process.”  

65. At an April 14, 2020 board meeting, the FAT Board asked Wiederhorn 

numerous questions about the purpose of FAT continuing to make loans to FCCG.  In 

response, Wiederhorn told the FAT Board that the loans were for the purpose of 

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paying off FCCG’s company creditors and business expenses.  Wiederhorn concealed 

his personal interest in these transactions and the fact that most of the funds FAT had 

loaned to FCCG were being used for the Wiederhorn Personal Cash Transfers.   

66. Based on these false statements by Wiederhorn, the FAT Board 

approved the Company continuing to send loans to FCGG through an Intercompany 

Revolving Credit Agreement (the “Intercompany Agreement”) at the April 14, 2020 

meeting.   

67. The FAT Board would not have approved these additional loans if it had 

known that the funds were and would be used to fund the Wiederhorn Personal Cash 

Transfers.   

68. In response to the auditor’s significant deficiency finding, the 

Intercompany Agreement included a control, added by the FAT Board, requiring that 

any additional lending to FCCG be approved in advance by the FAT Board.  The 

FAT Board approved this control at the April 14, 2020 meeting. 

69. At an April 21, 2020 meeting, the FAT Board again asked Wiederhorn 

“numerous questions and engaged in rigorous discussion about the Intercompany 

Revolving Credit Agreement [] between the Company and FCCG and the intended 

uses of cash and the Company's business reasons for the Company to make advances 

to FCCG.”  Wiederhorn again represented that the money would be used by FCCG to 

pay its legacy liabilities and again concealed his personal use of the funds.   

70. Based on these false statements, the FAT Board approved another 

$50,000 of additional lending to FCCG.  Wiederhorn violated this Board-imposed 

limitation and internal control by transferring almost $80,000 from FAT to FCCG 

between April 15, 2020 and April 27, 2020.   

71. Subsequently, at an April 28, 2020 meeting, the FAT Board approved 

one final loan amount of $1 million to FCCG for second quarter of 2020.   

72. However, after that date, without the FAT Board’s approval and in 

contravention of the Intercompany Agreement, Wiederhorn continued to lend to 

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FCCG millions of dollars and used the majority of the funds to make the Wiederhorn 

Personal Cash Transfers.   

73. From April 28, 2020 through approximately June 2020, Wiederhorn 

directed hundreds of thousands of dollars in transfers from FAT to FCCG beyond the 

$1 million authorized by the FAT Board.   

74. In the third quarter of 2020, Wiederhorn directed another $3 million in 

loans from FAT to FCCG, although the FAT Board authorized only $1 million.   

75. In the fourth quarter of 2020, Wiederhorn directed over $3.5 million in 

loans from FAT to FCCG. 

G. The Wiederhorn Children Were Officers at FAT 

76. During the Relevant Period, three of Wiederhorn’s children, including 

Thayer, were highly paid officers at FAT.  Two Wiederhorn children, including 

Thayer, had salaries of $300,000 a year in 2018 and 2019, and the third had a salary 

of $250,000 (the “Wiederhorn Children Salaries”).  

77. The Wiederhorn Children Salaries were not publicly disclosed to the 

Company’s investors until November 2020, when it filed its 2020 Schedule 14A 

Proxy Statement. 

H. FAT’s 2022 Special Review Committee Investigation  

78. In 2022, after learning of the SEC’s investigation, the FAT Board 

learned that Wiederhorn had been potentially using the loans from FAT to FCCG for 

his personal benefit. 

79. In response, the FAT Board formed a Special Review Committee (the 

“Committee”) consisting of independent board members to conduct an internal 

investigation into FAT’s loans to FCCG.   

80. During its investigation, the Committee confirmed that FAT’s loans to 

FCCG funded the Wiederhorn Personal Cash Transfers. 

I. In 2023, Wiederhorn Terminated the FAT Board 

81. On December 20, 2022, Wiederhorn terminated the chair of the 

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Committee. 

82. In February 2023, the FAT executive chairman of the FAT Board, 

having learned of the findings of the internal investigation, told Wiederhorn that he 

should resign as CEO or the FAT Board would likely take action against Wiederhorn.  

83. On March 28, 2023, Wiederhorn terminated the FAT executive chairman 

and all of the other independent directors on the FAT Board.  He then placed three of 

his children, including Thayer, on the FAT Board. 

J. The Wiederhorn Personal Cash Transfers, the Thayer Transactions, 

and the Wiederhorn Children Salaries Were Related Person 

Transactions That FAT Was Required to Report Under Item 404 

84. The Wiederhorn Personal Cash Transfers were related person 

transactions under Item 404.   

85. The transfers from FAT to FCCG that funded the Wiederhorn Personal 

Cash Transfers amounted to more than $120,000 each fiscal year from 2017-2020.   

86. Wiederhorn at all relevant times was a director and CEO of FAT, and 

therefore a related person of the Company.   

87. Wiederhorn had a direct or indirect material interest in the transfers from 

FAT to FCCG because the transfers from FAT to FCCG funded the Wiederhorn 

Personal Cash Transfers, which were used on Wiederhorn’s personal spending.  He 

used the transfers from FAT for his own personal benefit to, among other things, 

purchase travel on private jets, first class airfare, luxury vacations, his mortgage 

payments, shopping, and jewelry.  Wiederhorn’s interest in the transfers from FAT 

was material given that the transfers were for the purpose of funding his personal 

accounts or paying his personal debts, the amount far exceeded his publicly disclosed 

salary each year, and the amounts were equivalent to approximately 44 percent of 

FAT’s revenue from October 2017 through December 2020 and 40 percent of FAT’s 

revenue from July 2018 through December 2020.  

88. The Thayer Transactions were also related person transactions under 

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Item 404.   

89. The Thayer Transactions amounted to more than $120,000 in each year 

from 2017 to 2019, and Thayer was an immediate family member of Wiederhorn and 

was the chief marketing officer of FAT.   

90. Thayer also had a direct or indirect material interest in the Thayer 

Transactions, as he used his own personal accounts to transfer substantial funds into 

FAT.  Thayer’s interest in the Thayer Transactions was material given that over $9 

million, which was an amount equal to about 21 percent of FAT’s revenue from 

October 2017 through December 2019, was deposited into his personal accounts over 

which only he had access or control.   

91. The Wiederhorn Children Salaries were related person transactions 

under Item 404.   

92. The Wiederhorn children were immediate family members of 

Wiederhorn, and they had a direct or indirect material interest in their salaries.   

93. The Wiederhorn Children Salaries each amounted to more than 

$120,000 in fiscal years 2018 and 2019.  The Wiederhorn Children Salaries were 

material given these salaries were paid to the CEO’s children, and also because their 

salaries amounted to approximately 4-5 percent of FAT’s revenue. 

K. Ron Roe’s Role During the Relevant Period 

1. Roe Approved the Wiederhorn Personal Cash Transfers and 

the Thayer Transactions and Signed FAT’s 2017 Form 10-K 

94. Prior to working at FAT as its Chief Financial Officer, Roe was 

previously employed as FCCG’s CFO.   

95. At FCCG, Roe routinely assisted Wiederhorn in sending funds from 

FCCG’s accounts, or its subsidiaries Fatburger and Buffalo, to Wiederhorn, his 

family, and his personal creditors. 

96. After the FAT IPO, Roe continued this practice at FAT from October 

2017 through December 2020, despite the fact that the Company had additional 

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requirements to disclose related person transactions under Item 404.   

97. Roe often approved and sent the transfers from FAT to Wiederhorn, his 

family, or his creditors, including transfers that first passed through FCCG, and then 

directed the FAT cash managers on how the transfers should be recorded in FAT and 

FCCG’s accounting records.   

98. Specifically, FAT’s cash managers reported to Roe, and he told the FAT 

cash managers which transfers of FAT’s funds were for Wiederhorn’s personal 

expenses, and how those transfers should be recorded in FAT and FCCG’s books.  

99. Roe also instructed the FAT cash managers to use funds from FAT’s 

accounts to pay Wiederhorn’s personal bank accounts, his credit card bills, and any of 

his creditors at Wiederhorn’s request.   

100. Roe also directed the FAT cash managers on how the Thayer 

Transactions were recorded in FAT and FCCG’s accounting records. 

101. From 2017 through 2019, Roe personally recorded, or directed FAT cash 

managers how to record, the Thayer Transactions.   

102. As FAT’s CEO, Roe signed FAT’s 2017 Form 10-K, which falsely and 

misleadingly stated that FAT had disclosed all related person transactions.   

103. Roe knew, or was reckless in not knowing, that the Thayer Transactions 

exceeded $120,000 in fiscal year 2017 and were therefore related person transactions 

that required disclosure, yet had not been properly disclosed. 

2. Roe Was Aware of Wiederhorn’s False Representations to the 

FAT Board 

104. Given his role in recording Wiederhorn Personal Cash Transfers and the 

Thayer Transactions, Roe knew, or was reckless in not knowing, that the funds FAT 

transferred to FCCG were primarily being used by Wiederhorn to fund the 

Wiederhorn Personal Cash Transfers for Wiederhorn’s personal benefit.  

105. For example, Roe was included in the May 2019 and April 2020 email 

communications, referenced supra in paragraphs 56 and 57, between Wiederhorn and 

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the FAT Board, where Wiederhorn concealed that the funds FAT was sending to 

FCCG were primarily being used for the Wiederhorn Personal Cash Transfers.   

106. In another example, Roe also attended the FAT Board meetings in April 

2020 where Wiederhorn falsely represented to the FAT Board that the purpose of 

FAT’s loans to FCCG was to pay FCCG’s business expenses and FCCG’s creditors.   

Roe was also a signatory of the Intercompany Agreement and attended the April 14, 

2020 meeting wherein the FAT Board added an internal control requiring that any 

additional lending to FCCG be approved in advance by the FAT Board.   

107. Roe therefore also knew, or was reckless in not knowing, that 

Wiederhorn made false and misleading statements to the FAT Board about the true 

purpose of FAT lending millions in cash to FCCG and, despite being an executive 

officer of FAT, did not take steps to correct those statements to the FAT Board.   

L. Rebecca Hershinger’s Role During the Relevant Period 

1. Hershinger Was Aware that Wiederhorn used the 

Wiederhorn Personal Cash Transfers for His Personal Benefit 

and Was Aware of the Wiederhorn Children Salaries 

108. Hershinger succeeded Roe as FAT’s Chief Financial Officer.  As FAT’s 

Chief Financial Officer from 2018 to 2021, Hershinger knew, or was reckless in not 

knowing, that Wiederhorn was using substantial sums of FAT’s funds for his 

personal spending and that Thayer was wiring millions of dollars into FAT.   

109. For example, in October 2018, Hershinger circulated a ledger of FAT’s 

loans to FCCG internally to Roe and others, which showed more than $1 million in 

wires going from FAT directly into Wiederhorn's personal accounts, more than $3 

million in wires in Thayer Transactions, and hundreds of thousands of dollars of 

entries described as “AW AMEX.”   

110. Similarly, in March 2019, Hershinger had communications with FAT’s 

cash team that the Company was paying Wiederhorn’s personal credit cards using the 

funds that FAT was loaning to FCCG.  

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111. As another example, in May 2019, Hershinger circulated FCCG’s 

December 2018 consolidating worksheets showing that Wiederhorn had received 

over $9 million from FAT in 2018 alone.   

112. Likewise, in May 2020, Hershinger personally performed an account 

reconciliation of the money due from FCCG to FAT.  This reconciliation included her 

analysis of FCCG’s bank accounts reflecting at least one million dollars in transfers 

from FAT to FCCG, which were transferred to Wiederhorn’s personal bank accounts 

in the form of Wiederhorn Personal Cash Transfers in the first quarter of 2020 alone.   

113. Finally, as FAT’s CFO, Hershinger regularly reviewed FAT’s budgets 

which reflected the Wiederhorn Children Salaries.  Accordingly, Hershinger knew, or 

should have known, the Wiederhorn Children Salaries by early 2019 when she 

reviewed FAT’s fiscal year 2018 documentation in preparing the Company’s 10-K. 

114. Hershinger reviewed, approved, and signed FAT’s Form 10-Ks from 

years 2018-2020.   

115. Despite knowing, or being reckless in not knowing, that both the Thayer 

Transactions and the Wiederhorn Children Salaries exceeded $120,000 in 2018 and 

2019, and that the Wiederhorn Personal Cash Transfers exceeded $120,000 in 2018, 

2019 and 2020, but none had been disclosed as related person transactions, 

Hershinger signed FAT’s Form 10-Ks which falsely and misleadingly stated that 

FAT had disclosed all related person transactions. 

2. Hershinger Was Aware that Wiederhorn Made False 

Representations to the FAT Board as well as on His Director 

and Officer Questionnaires   

116. In February 2019, Hershinger, in her role as Chief Financial Officer of 

FAT, requested that Wiederhorn complete his director and officer questionnaire for 

fiscal year 2018.  Wiederhorn then sent Hershinger the completed FAT’s director and 

officer questionnaire in or around March 2019.    

117. Wiederhorn’s completed questionnaire did not disclose that Wiederhorn 

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had an interest in the transfers from FAT to FCCG, including that FAT was paying 

his personal credit cards.  Instead, Wiederhorn’s signed questionnaire falsely stated 

that neither Wiederhorn nor his family had a direct or indirect material interest in any 

transaction or series of transactions to which FAT was a party and in which the dollar 

amount exceeded $120,000. 

118. Hershinger knew, or was reckless in not knowing, that Wiederhorn was 

personally benefitting from the transfers from FAT to FCCG, and that Thayer was 

wiring millions of dollars into FAT.   Yet in March 2020, Hershinger emailed 

Wiederhorn a pre-completed questionnaire for FAT’s 2019 Form 10-K, which 

contained the false answers from his 2018 questionnaire.   

119. In addition, almost a year later in February 2021, Hershinger directed 

FAT employees to transfer the answers from Wiederhorn’s 2019 questionnaire to 

Wiederhorn’s 2020 questionnaire “exactly as presented.” 

120. Like Roe, Hershinger attended the FAT Board meetings in April 2020 

referenced supra in paragraphs 56 and 57 where Wiederhorn falsely represented to 

the FAT Board that the purpose of the FAT’s loans to FCCG was to pay FCCG’s 

business expenses and FCCG’s creditors.    

121. Finally, Hershinger also attended the April 14, 2020 meeting wherein the 

FAT Board added an internal control requiring that any additional lending to FCCG 

be approved in advance by the FAT Board.  Given her role as CFO, her role in 

performing the May 2020 account reconciliation, her role in preparing FAT's 

financial statements which reflected the additional lending to FCCG in each quarter, 

and the fact that she attended the FAT Board meetings where the Board placed 

specific limits on the amounts Wiederhorn was permitted to lend to FCCG, 

Hershinger was aware that Wiederhorn continued to lend money to FCCG in excess 

of the amounts authorized by the FAT Board. 

M. Wiederhorn, Roe, and Hershinger Lied to FAT’s Auditors 

122. During the Relevant Period, FAT retained outside auditors to conduct 

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annual audits and quarterly reviews.   

123. Wiederhorn, Roe, and Hershinger made numerous false statements to 

FAT’s auditors relating to the Wiederhorn Personal Cash Transfers, the Thayer 

Transactions, and/or the Wiederhorn Children Salaries. 

124. In February 2019, Wiederhorn signed and submitted to FAT’s auditors a 

related party questionnaire falsely representing that neither he nor any of his 

immediate family members had an interest in any transactions with the Company, 

despite Wiederhorn knowing that he had an interest in FAT’s transfers from FAT to 

FCCG and that his son Thayer had an interest in the Thayer Transactions. 

125. During the 2019 audit of FAT, the Company’s auditor asked Wiederhorn 

about the purpose of FAT paying his personal credit card.  In response, Wiederhorn 

falsely stated to the auditor that FAT had paid his personal credit card because the 

“charges were for [FCCG] expenses.”   

126. Around this same time, Wiederhorn falsely stated to the auditor that 

certain expenses identified as “AW Personal” were in fact FCCG business expenses.   

127. In March 2020, in response to the auditor asking Wiederhorn about the 

purpose of FAT loaning money to FCCG, Wiederhorn falsely told the auditor that the 

purpose of the loans was to assist FCCG with paying ongoing and legacy liabilities 

and business expenses.   

128. Each year during the Relevant Period, in his role as the Company’s 

CEO, Wiederhorn was required to sign annual management representation letters 

directed to FAT’s auditors.   

129. The management representation letters were relied on by the auditors in 

rendering an opinion concerning the accuracy of FAT’s financial statements. 

130. In these letters, Wiederhorn represented to FAT’s auditors that the 

Company had made available “All financial records and related data, including names 

of all related parties and all relationships and transactions with related parties.”   

131. Wiederhorn also represented that “[w]e have disclosed to you the 

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identity of [FAT]’s related parties and all information concerning related-party 

relationships, transactions and amounts receivable from or payable to related parties 

of which we are aware.”   

132. Wiederhorn’s representations were materially false and misleading.  

Despite representing that he had disclosed all related parties and all relationships and 

transactions with related parties, Wiederhorn did not properly disclose his own 

related party transactions with FAT, the fact that he was using FAT’s loans to FCCG 

for his Wiederhorn Personal Cash Transfers, or the Thayer Transactions. 

133. In addition, despite the fact that Wiederhorn was taking direct or indirect 

loans from FAT in the form of personal loans that funded the Wiederhorn Personal 

Cash Transfers, he falsely represented in pertinent part to FAT’s auditors in annual 

management representation letters that the Company: 

[H]as not, directly or indirectly, including through any subsidiary, extended or 
maintained credit, arranged for the extension of credit or renewed an extension 
of credit in the form of a personal loan to or for any director or executive officer. 

134. Roe and Hershinger also reviewed, approved, signed, and certified the 

false management representation letters during the Relevant Period as the respective 

CFOs of the Company.   

135. Roe co-signed and certified the 2017 management representation letter.   

136. Hershinger co-signed and certified the 2018, 2019, and 2020 

management representation letters.   

137. The 2017 management letter contained false and misleading 

representations and omitted material information because the Company had not 

disclosed Wiederhorn’s direct or indirect material interest in the Wiederhorn Personal 

Cash Transfers or the Thayer Transactions to the auditors.   

138. The 2018 management letter contained false and misleading 

representations and omitted material information because the Company had not 

disclosed Wiederhorn’s direct or indirect material interest in the Wiederhorn Personal 

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Cash Transfers or the Thayer Transactions to the auditors. 

139. The 2019 management letter contained false and misleading 

representations and omitted material information because the Company had not 

disclosed Wiederhorn’s direct or indirect material interest in the Wiederhorn Personal 

Cash Transfers or the Thayer Transactions to the auditors. 

140. The 2020 management letter contained false and misleading 

representations and omitted material information because the Company had not 

disclosed Wiederhorn’s direct or indirect material interest in the Wiederhorn Personal 

Cash Transfers or the Thayer Transactions to the auditors. 

141. Roe made additional false statements to FAT’s auditors throughout the 

Relevant Period.   

142. In a March 2018 interview with FAT’s auditor, the auditor asked Roe to 

identify all related parties with whom FAT had a transaction, a description of the 

transactions, and the business purpose of those transactions.   

143. Roe identified only FCCG and Buffalo as related parties with an interest 

in transactions in which FAT was a participant.  Roe did not identify either 

Wiederhorn or Thayer as related parties with interests in FAT’s transactions, even 

though he assisted Wiederhorn with transferring FAT’s funds through the 

Wiederhorn Personal Cash Transfers and after having personally reviewed and 

recorded the Thayer Transactions in the Company’s accounting records.  By engaging 

in this conduct, Roe assisted Wiederhorn in concealing the Wiederhorn Personal Cash 

Transfers and the Thayer Transactions from FAT’s auditors.  

144. In September and October 2020, Roe provided the auditor with a 

purported loan agreement which he claimed represented that FCCG’s board of 

directors had approved $25 million in loans from FCCG to Wiederhorn in January 

2018.   

145. However, Roe’s representation to the auditors was false because 

FCCG’s board of directors were never aware of and did not approve either the loan 

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agreement or the loans. 

146. Hershinger also made additional false statements to FAT’s auditors 

throughout the Relevant Period.   

147. In 2019 and 2020, Hershinger represented to the Company’s auditors 

that the Wiederhorn Children Salaries had “been disclosed in prior periods proxy 

statements.”   

148. These representations to the Company’s auditors in 2019 and 2020 were 

not true because FAT did not report Wiederhorn Children Salaries as related person 

transactions (or otherwise) until November 2020, when it filed its 2020 Schedule 14A 

Proxy Statement. 

N. FAT’s SEC Filings Contained Materially False and Misleading 

Statements 

149. As a public reporting company, FAT filed quarterly Forms 10-Q, annual 

Forms 10-K, and annual Schedule 14A Proxy Statements with the SEC during the 

Relevant Period.  In addition, FAT also conducted an offering in September 2019 

pursuant to Regulation A and a separate offering in July 2020 pursuant to Form S-1.   

150. FAT’s public filings during the Relevant Period contained numerous 

false and misleading statements regarding (1) the Wiederhorn Personal Cash 

Transfers, (2) the Thayer Transactions, (3) the Wiederhorn Children Salaries, and (4) 

the Company’s use of investment and loan proceeds.   

1. Materially False and Misleading Statements Regarding the 

Wiederhorn Personal Cash Transfers and the Thayer 

Transactions  

151. FAT’s Forms 10-K contained false and misleading statements regarding 

the Wiederhorn Personal Cash Transfers and the Thayer Transactions.   

152. FAT’s 2017 Form 10-K represented that the company had “open 

accounts with affiliated entities under the common control of FCCG resulting in net 

amounts due to [FAT] of $7,963,000 as of December 31, 2017.”   

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153. Apart from these transactions with FCCG, FAT’s 2017 Form 10-K 

represented that: “there has not been, nor is there currently proposed, any transaction 

or series of similar transactions to which [FAT] was or will be a party in which the 

amount involved exceeds $120,000 and in which any director, executive officer, 

shareholder who beneficially owns 5% or more of our common stock or any member 

of their immediate family had or will have a direct or indirect material interest.”  

154. FAT’s 2018 Schedule 14A Proxy Statement incorporated the disclosures 

in FAT’s 2017 Form 10-K and represented that there were no reportable related 

person transactions other than those described in FAT’s 2017 Form 10-K. 

155. These affirmative statements in FAT’s 2017 Form 10-K and its 2018 

Proxy Statement were materially false and misleading half-truths because neither 

filing properly disclosed that: (i) Wiederhorn used more than $1 million of FAT 

funds on Wiederhorn Personal Cash Transfers for his personal expenses between 

October and December 2017; and (ii) the approximately $220,000 in Thayer 

Transactions between October and December 2017.   

156. FAT’s 2018 Form 10-K further represented that “Since January 1, 2018, 

the Company has engaged in certain transactions with Fog Cutter Capital Group Inc.” 

and had “open accounts with affiliated entities under the common control of FCCG 

resulting net amounts due to the Company of $15,514,000.”   

157. Apart from these transactions with FCCG, FAT’s 2018 Form 10-K also 

represented that “there has not been, nor is there currently proposed, any transaction 

or series of similar transactions to which [FAT] were or will be a party in which the 

amount involved exceeds $120,000 and in which any director, executive officer, 

shareholder who beneficially owns 5% or more of our common stock or any member 

of their immediate family had or will have a direct or indirect material interest.”   

158. FAT’s 2019 Schedule 14A Proxy Statement similarly identified related 

person transactions between FAT and FCCG and further represented that “since the 

beginning of the 2018 fiscal year” there were no reportable related person 

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transactions, other than those described in FAT’s 2018 Form 10-K or the Proxy 

Statement. 

159. These affirmative statements in FAT’s 2018 Form 10-K and its 2019 

Proxy Statement were materially false and misleading half-truths because neither 

filing properly disclosed that Wiederhorn was the primary beneficiary of the loans 

from FAT to FCCG and that Wiederhorn used almost $9 million of FAT funds on 

Wiederhorn Personal Cash Transfers for his personal expenses between January and 

December 2018.  Similarly, the Company’s 2018 10-K and 2019 Proxy Statement did 

not properly disclose the approximately $5.5 million in Thayer Transactions between 

January and December 2018.  Finally, the Company’s 2018 10-K and 2019 Proxy 

Statement did not properly disclose the Wiederhorn Children Salaries from January to 

December 2018. 

160. FAT’s 2019 Form 10-K represented that “Since December 31, 2018, the 

Company has engaged in certain transactions with Fog Cutter Capital Group Inc.” 

and had “$25,967,000 net amounts due to the Company.”  Apart from these 

transactions with FCCG, FAT also represented that “there has not been, nor is there 

currently proposed, any transaction or series of similar transactions to which [FAT] 

were or will be a party in which the amount involved exceeds $120,000 and in which 

any director, executive officer, shareholder who beneficially owns 5% or more of our 

common stock or any member of their immediate family had or will have a direct or 

indirect material interest.”   

161. FAT’s 2020 Schedule 14A Proxy Statement similarly identified related 

person transactions between FAT and FCCG and further represented that “since the 

beginning of the 2019 fiscal year” there were no reportable related person 

transactions, other than those described in FAT’s 2019 Form 10-K or the Proxy 

Statement. 

162. These affirmative statements in FAT’s 2019 Form 10-K and its 2020 

Proxy Statement were materially false and misleading half-truths because these 

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filings did not properly disclose that Wiederhorn used about $7 million of FAT funds 

on Wiederhorn Personal Cash Transfers for his personal expenses between January 

and December 2019.  Similarly, the Company’s 2019 10-K and 2020 Proxy 

Statement did not properly disclose the more than $3.5 million in Thayer 

Transactions between January and December 2019.  Finally, the 2019 10-K did not 

properly disclose the Wiederhorn Children Salaries from January to December 2019. 

163. FAT’s 2020 Form 10-K represented that “Since December 29, 2019, the 

Company has engaged in certain transactions with Fog Cutter Capital Group Inc,” 

“the Company had previously extended credit to FCCG,” and “FCCG historically 

made loan advances to Andrew A. Wiederhorn, its CEO and significant stockholder.”  

Apart from these transactions, FAT further represented that “there has not been, nor 

is there currently proposed, any transaction or series of similar transactions to which 

[FAT] were or will be a party in which the amount involved exceeds $120,000 and in 

which any director, executive officer, shareholder who beneficially owns 5% or more 

of our common stock or any member of their immediate family had or will have a 

direct or indirect material interest.”   

164. These affirmative statements were materially false and misleading half-

truths because the 2020 10-K did not properly disclose that Wiederhorn had a direct 

or indirect material interest in the loans to FCCG or that Wiederhorn used 

approximately $9.6 million of FAT funds on Wiederhorn Personal Cash Transfers for 

his personal expenses between January and December 2020.   

2. Materially False and Misleading Statements Regarding Use of 

Loan Proceeds and Proceeds from Securitization Notes  

165. With approximately 40 percent of its revenue used by Wiederhorn to pay 

his personal expenses through the Wiederhorn Personal Cash Transfers, FAT needed 

financing from outside sources to fund its operations.   

166. During the Relevant Period, FAT borrowed approximately $23.5 million 

from “Fund I” and “Fund II” (“the Funds”), two outside investment funds 

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incorporated in Delaware.   

167. On January 29, 2019, FAT borrowed $20 million in loans from Fund I, 

and on June 19, 2019, FAT borrowed an additional $3.5 million in loans from Fund II 

(collectively, the “Fund Proceeds”).   

168. The loan proceeds from Fund I were primarily used to pay off FAT’s 

existing loans from outside lenders, leaving FAT with only about $1.7 million in 

proceeds remaining.  Wiederhorn directed FAT’s cash team to transfer approximately 

25 percent of these funds to pay his personal debts.  From Fund II, Wiederhorn 

directed FAT’s cash team to wire $550,000 of the loan proceeds, about 16 percent of 

the available proceeds, to an attorney to fund the settlement of a personal court 

judgment against Wiederhorn that was unrelated to FAT’s business.   

169. FAT’s 2018 and 2019 Forms 10-K, Q1-Q3 2019 Forms 10-Q, and 

September 2019 Regulation A offering statement contained affirmative false and 

misleading statements relating to FAT’s use of the Fund Proceeds.   

170. For Fund I, FAT’s 2018 and 2019 Forms 10-K, Forms 10-Q for Q1-Q3 

2019, and September 2019 Regulation A offering disclosed that FAT had “borrowed 

$20 million [the Fund] and utilized the proceeds to repay the existing $16 million 

term loan from FB Lending, LLC plus accrued interest and fees, and provide 

additional general working capital to the Company.”   

171. This affirmative statement was a materially false and misleading half-

truth because Wiederhorn had in fact used a substantial amount of the remaining 

Fund Proceeds to pay down his personal debt. 

172. Similarly, for Fund II, FAT’s 2019 Form 10-K, Forms 10-Q for Q2 and 

Q3 2019, and FAT’s September 2019 Regulation A Offering Statement disclosed that 

the Company borrowed an additional $3.5 million from Fund II in June 2019 to fund 

the acquisition of another restaurant chain and to “acquire other assets and pay fees 

and expenses of the transactions.”   

173. This affirmative statement was a materially false and misleading half-

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truth because on the same day that FAT received the funds from Fund II, at 

Wiederhorn’s direction, FAT had in fact wired approximately 16 percent of the Fund 

Proceeds to pay his personal creditor.  

174. In addition to the Fund Proceeds it received from the Funds, FAT raised 

additional capital on March 6, 2020, by issuing notes pursuant to an asset-backed 

securitization (the “Securitization Notes”).  The net proceeds from the issuance of 

these Securitization Notes was $37,314,000.  FAT used $26,771,000 of these 

proceeds to pay off its outstanding balance owed to the Funds.  The remaining 

proceeds amounted to approximately $10.5 million.   

175. On March 9, 2020, FAT sent approximately $2.8 million of the 

remaining proceeds to FCCG, of which approximately $1.2 million was immediately 

sent to Wiederhorn, his family, and his personal creditors as Wiederhorn Personal 

Cash Transfers.  

176. In its 2019 and 2020 Forms 10-K, Q1 through Q3 2020 Forms 10-Q, and 

July 2020 Form S-1 Offering Statement, however, FAT disclosed the use of the 

proceeds from the Securitization Notes as follows:  

Net proceeds from the issuance of the Securitization Notes were $37,314,000 . . 
. A portion of the proceeds from the Securitization was used to repay the 
remaining $26,771,000 in outstanding balance under the [Fund] Loan and 
Security Agreement. The remaining proceeds from the Securitization will be 
used for working capital. 

177. These affirmative statements were materially false and misleading half-

truths because, before this disclosure was made, approximately 27 percent of the 

$10.5 million had been used for purposes other than for FAT’s “working capital,” and 

approximately 12 percent was used for Wiederhorn Personal Cash Transfers. 

3. Materially False and Misleading Statements Regarding the 

Wiederhorn Children Salaries 

178. FAT’s 2018 and 2019 Forms 10-K and FAT’s 2018 and 2019 Schedule  

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14A Proxy Statements represented that apart from certain transactions with FCCG: 

there has not been, nor is there currently proposed, any transaction or series of 
similar transactions to which [FAT] were or will be a party in which the amount 
involved exceeds $120,000 and in which any director, executive officer, 
shareholder who beneficially owns 5% or more of our common stock or any 
member of their immediate family had or will have a direct or indirect material 
interest. 

179. These affirmative statements were materially false and misleading half-

truths because the Forms 10-K and Schedule 14A Proxy Statements did not disclose 

the Wiederhorn Children Salaries.   

4. Wiederhorn, Roe, and Hershinger Signed and Certified FAT’s 

Public Filings 

180. As the Chief Executive Officer FAT, Wiederhorn was responsible for 

reviewing and approving the Company’s reports filed with the SEC.  In connection 

with signing these reports, he signed certifications under the Sarbanes-Oxley Act of 

2002, attesting that, among other things, each report “did not include any material 

misstatements or omissions.” 

181. As the Chief Financial Officer of FAT, Roe was responsible for 

reviewing and approving the Company’s reports filed with the SEC.  In connection 

with signing these reports, he signed a certification under the Sarbanes-Oxley Act of 

2002, attesting that, among other things, each report “did not include any material 

misstatements or omissions.” 

182. As the Chief Financial Officer of FAT, Hershinger was responsible for 

reviewing and approving the Company’s reports filed with the SEC.  In connection 

with signing these reports, she signed certifications under the Sarbanes-Oxley Act of 

2002, attesting that, among other things, each report “did not include any material 

misstatements or omissions.” 

183. Wiederhorn, as the Chief Executive Officer of FAT, reviewed, approved, 

signed, and certified (1) each of FAT’s Forms 10-K for fiscal years 2017-2020, (2) 

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each of FAT’s Forms 10-Q for Q1-Q3 2019 and Q1-Q3 2020, (3) the 2018-2020 

Schedule 14A Proxy Statements, (4) the September 2019 Regulation A Offering 

Statement, and (5) the July 2020 Form S-1 Offering Statement.  Wiederhorn was 

therefore the maker of the false statements in these filings. 

184. Roe, as the Chief Financial Officer of FAT, reviewed, approved, signed, 

and certified the FAT Form 10-K for fiscal year 2017.  Roe was therefore the maker 

of the false statements in this filing. 

185. Hershinger, as the Chief Financial Officer of FAT, reviewed, approved, 

signed, and certified the FAT Forms 10-K for fiscal years 2018-2020 and the 

Company’s July 2020 Form S-1 Offering Statement.  Hershinger was therefore the 

maker of the false statements in these filings. 

O. Wiederhorn’s Fraudulent Schemes  

186. From July 2018, when FAT reported that the FCCG Promissory Note 

was almost fully paid back, until March 2021, Wiederhorn engaged in a scheme to 

divert FAT’s cash to fund the Wiederhorn Personal Cash Transfers for his own 

personal benefit while concealing these transfers from the FAT Board, FAT’s 

auditors, and investors.  He executed this scheme by directing Roe and the FAT cash 

managers to effectuate the Wiederhorn Personal Cash Transfers for his personal 

benefit and by misleading the FAT Board and FAT’s auditors about the loans FAT 

was making to FCCG.   

187. In addition, between October 2017 and December 2019, Wiederhorn 

engaged in a scheme to conceal FAT’s inability to pay its own bills by directing over 

$9 million in Thayer Transactions.   

188. Wiederhorn engaged in numerous deceptive acts to create false 

appearances of fact to further his schemes, including:  not disclosing the Wiederhorn 

Personal Cash Transfers or the Thayer Transactions in his director and officer 

questionnaires and related party questionnaire, making false statements to the FAT 

Board and FAT’s auditors about the purpose of the loans from FAT to FCCG; and 

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disseminating false statements by signing FAT company filings containing false and 

misleading representations about related person transactions.  

189. Between July 2018 and December 2020, Roe substantially assisted 

Wiederhorn with his scheme to divert FAT’s cash to fund the Wiederhorn Personal 

Cash Transfers for his own personal benefit.  Between October 2017 and December 

2019, Roe assisted Wiederhorn with his scheme to conceal FAT’s inability to pay its 

own bills by directing over $9 million in Thayer Transactions.   

190. Between October 2017 and December 2020, Roe oversaw the FAT cash 

management team and directed to which of Wiederhorn’s accounts to send FAT 

funds and effectuating many of the transfers himself.  Despite being an executive 

officer of FAT and knowing all the details about the Wiederhorn transfers and the 

Thayer Transactions, Roe did not inform the FAT Board when he knew, or was 

reckless in not knowing, that Wiederhorn misled them about how the proceeds of 

FAT’s loans to FCCG were being used. Roe also reviewed, revised, and signed 

FAT’s 2017 Form 10-K thereby assisting Wiederhorn in disseminating false and 

misleading statements which concealed Wiederhorn’s schemes.    

P. FAT’s False and Misleading Statements and Wiederhorn’s 

Fraudulent Schemes Were in Connection with the Offer or Sale of 

Securities  

191. Wiederhorn’s scheme and FAT’s false and misleading statements were 

in connection with the offer or sale of securities.   

192. Throughout the Relevant Period, while Wiederhorn engaged in his 

fraudulent scheme, FAT’s shares were publicly traded on the NASDAQ, a public 

stock exchange based in the United States.  

193. On June 6, 2019, FAT filed a Form 1-A Regulation A Offering 

Statement. The offering incorporated by reference the false and misleading 

statements about related person transactions and use of proceeds made in FAT’s 2018 

Form 10-K and Q2 2019 Form 10-Q filings and restated the false and misleading 

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statements regarding the use of Lion Fund Proceeds. Through the offering, FAT 

issued securities in the form of shares of FAT and raised proceeds from investors of 

approximately $1,077,000. 

194. On July 13, 2020, FAT filed a Form S-1 Registration statement and 

amendments.  The offering statement incorporated by reference the false and 

misleading statements about related person transactions made in FAT’s 2019 Form 

10-K filing and restated the false and misleading statements about the use of proceeds 

from the Securitization Notes. Through the offering, FAT issued securities in the 

form of shares of FAT and raised proceeds from investors of $8,021,000.   

Q. FAT’s False and Misleading Statements Were Material 

195. The false and misleading statements regarding the Wiederhorn Personal 

Cash Transfers, the Thayer Transactions, the Wiederhorn Children Salaries, and the 

Use of Proceeds were material.   

196. The approximately $26.7 million in FAT funds that Wiederhorn used to 

fund the Wiederhorn Personal Cash Transfers from October 2017 through December 

2020 amounted to approximately 44 percent of FAT’s total revenue during this 

period.  The approximately $20 million FAT funds that Wiederhorn used to fund the 

Wiederhorn Personal Cash Transfers from July 2018 through December 2020 

amounted to approximately 40 percent of FAT’s total revenue during this period.  

197. A reasonable investor would have considered it important that 

Wiederhorn channeled almost half of FAT’s revenue to himself for his personal use.   

198. Moreover, FAT’s board of directors would not have approved company 

loans or transfers to FCCG during the Relevant Period if they had known that they 

were funding Wiederhorn’s expenses personally.    

199. The Thayer Transactions from October 2017 through December 2019 

amounted to approximately 21 percent of FAT’s revenue during this period.  

200. A reasonable investor would have considered it important that 

Wiederhorn used millions in Thayer Transactions to conceal the fact that FAT was 

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unable to pay its bills. 

201. Similarly, the false and misleading statements regarding the Use of 

Proceeds in 2019 and 2020 were material because a reasonable investor would have 

found it important to know that FAT’s CEO was using FAT’s money for himself or 

on his family and not using proceeds on “general working capital” or for the benefit 

of the Company as represented in FAT’s SEC filings.    

202. Finally, the false and misleading statements regarding the Wiederhorn 

Children Salaries were material because a reasonable investor of FAT would have 

found it important to know that the children of the CEO were earning at least a 

quarter million dollars each in 2018 and 2019.   

203. During this period, the Wiederhorn Children Salaries amounted to 

between approximately 4 percent and 5 percent of FAT’s total revenue. 

R. Wiederhorn, Roe, and Hershinger Acted with Scienter  

204. During the Relevant Period, Wiederhorn acted with scienter.  

Wiederhorn directed the Wiederhorn Personal Cash Transfers and the Thayer 

Transactions to personally benefit from FAT’s funds.  He hid both the Wiederhorn 

Personal Cash Transfers and the Thayer Transactions from the FAT Board, the 

company’s auditors, and FAT’s investors.   

205. Wiederhorn reviewed, edited, approved, and signed FAT’s Forms 10-Ks 

and other company filings.  He therefore knew, or was reckless in not knowing, that 

he disseminated the false statements contained in FAT’s Forms 10-Ks and other 

company filings in furtherance of his scheme which misrepresented the Wiederhorn 

Personal Cash Transfers and the Thayer Transactions.   

206. Wiederhorn also misrepresented the purpose of FAT’s loans and 

concealed the Wiederhorn Personal Cash Transfers from the FAT Board in both 

email communications and statements made during meetings, as well as submitted 

false and misleading questionnaires and management representation letters to the 

Company’s auditors concealing both the Wiederhorn Personal Cash Transfers and 

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Thayer Transactions. 

207. As the CEO of FAT, Wiederhorn also knew of the Wiederhorn Children 

Salaries, and yet did not disclose the Wiederhorn Children Salaries in the FAT Forms 

10-K or Schedule 14A Proxy Statements for FY 2018 and 2019.   

208. Wiederhorn’s conduct in connection with the Wiederhorn Personal Cash 

Transfer, the Thayer Transactions, and the Wiederhorn Children Salaries was 

unreasonable under the circumstances, and by engaging in that conduct, he also acted 

negligently. 

209. Roe also acted with scienter.  Throughout the Relevant Period, Roe 

personally oversaw the FAT cash team and approved sending the Wiederhorn 

Personal Cash Transfers from FAT’s company accounts for Wiederhorn’s benefit.  

Roe also instructed the FAT cash managers to use funds from FAT’s accounts to pay 

Wiederhorn’s personal credit card bills, and often paid the credit card bills himself 

using FAT’s funds.  He also personally directed the FAT cash managers on the 

Thayer Transactions.   

210. During the Relevant Period, Roe also signed the FAT 2017 10-K which 

he knew, or was reckless in not knowing, represented to FAT investors that FAT had 

engaged in no reportable related person transactions with Wiederhorn or his 

immediate family.  Roe also co-signed FAT’s 2017 management representation letter 

with Wiederhorn which represented that all related party transactions had been 

disclosed, despite knowing, or being reckless in not knowing, that neither he nor 

Wiederhorn had disclosed that Wiederhorn was using FAT funds for the Wiederhorn 

Personal Cash Transfers for his personal use, or the Thayer Transactions.  In May 

2019 and April 2020, Roe, as an executive officer of FAT, was copied on emails 

between Wiederhorn and FAT’s Board wherein Wiederhorn concealed that the 

primary purpose of the lending from FAT to FCCG was to fund the Wiederhorn Cash 

Transfers.  Roe knowingly or recklessly did not correct Wiederhorn’s representations 

to the FAT board.    

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211. Roe’s conduct in connection with the Wiederhorn Personal Cash 

Transfers and the Thayer Transactions was unreasonable under the circumstances, 

and by engaging in that conduct, he also acted negligently. 

212. Hershinger also acted with scienter.  In both 2019 and 2020, Hershinger 

accessed FAT’s loan ledger as well as FCCG’s loan ledger which reflected millions 

of dollars in wires to Wiederhorn’s personal accounts.  In May 2019, she circulated 

documents showing more than $9 million in Wiederhorn Personal Cash Transfers in 

2018.  In addition, in March 2019, Hershinger had discussions with FAT’s controller 

about the Company paying Wiederhorn’s personal credit cards for his personal 

charges.  Hershinger also personally conducted a reconciliation analyzing banking 

transactions reflecting more than $1 million in Wiederhorn Cash Transfers.  

However, Hershinger signed the FAT 2019 and 2020 10-Ks which she knew, or was 

reckless in not knowing, falsely represented to FAT investors that Wiederhorn was 

not involved in any related person transactions.   

213. Hershinger also received Wiederhorn’s responses to FAT’s director and 

officer questionnaires in 2019 and 2020, which she knew or was reckless in not 

knowing, misrepresented that Wiederhorn did not have a direct or indirect material 

interest in any transactions over $120,000 in which FAT was a participant.  However, 

Hershinger did not take any steps to correct Wiederhorn’s misrepresentations, despite 

being the Chief Financial Officer of the company, and transferred his misleading 

responses in subsequent questionnaires, knowing, or being reckless in not knowing, 

they would be relied upon by the Company for purposes of preparing its Forms 10-K 

and proxy statement filings. 

214. Hershinger’s conduct in connection with the Wiederhorn Personal Cash 

Transfers was unreasonable under the circumstances, and by engaging in that 

conduct, she also acted negligently. 

215. During the Relevant Period, Wiederhorn was a corporate officer acting 

as an agent for FAT within the scope of his employment.  Therefore, his intent can be 

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imputed to FAT.    

216. During the Relevant Period, Roe was a corporate officer acting as an 

agent for FAT within the scope of his employment.  Therefore, his intent can be 

imputed to FAT.    

217. During the Relevant Period, Hershinger was a corporate officer acting as 

an agent for FAT within the scope of her employment.  Therefore, her intent can be 

imputed to FAT.    

S. FAT’s Books and Records Were Inaccurate and the Company 

Failed to Maintain a Sufficient Internal Accounting Controls  

218. FAT failed to make and keep books and records that accurately reflected 

the reportable related person transactions.  Specifically, FAT failed to track and 

report its own CEO’s direct or indirect material interest in the Company was sending 

to FCCG, an affiliate company.   

219. Wiederhorn made false and misleading statements in his director and 

officer questionnaires about reportable related person transactions that would 

have allowed FAT to accurately track and report those transactions. 

220. In addition, despite FAT’s auditor notifying the FAT Board of an 

internal control deficiency relating to Wiederhorn having complete control over 

FAT’s accounts in early 2020, FAT did not devise or maintain an internal accounting 

control system that provided reasonable assurance that access to assets was consistent 

with addressing this deficiency.  Despite the FAT Board devising a control on April 

14, 2020 which required FAT Board advance approval for any additional lending to 

FCCG be approved in advance by the FAT Board, Wiederhorn authorized loan 

amounts from FAT to FCCG beyond the limits approved by the FAT Board.  As a 

result, during the second quarter, the third quarter, and the fourth quarter of 2020, 

Wiederhorn lent FAT money to FCCG far in excess of the FAT Board-approved 

amounts. 

221. Wiederhorn, as FAT’s CEO, knew or was reckless in not knowing that 

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FAT failed to track, report, and disclose reportable related person transactions, that he 

could transfer money from FAT at his own discretion, and that he made false 

statements to the FAT Board at April 2020 meetings regarding the purpose of the 

FAT loans to FCCG.  Wiederhorn was also aware that the FAT Board included a 

control on April 14, 2020 requiring that any additional lending to FCCG be approved 

in advance by the FAT Board, and that he authorized loan amounts from FAT to 

FCCG beyond the limits approved by the FAT Board.  In addition, Wiederhorn 

signed director and officer questionnaires that made false and misleading statements 

about reportable related person transactions that would have allowed FAT to 

accurately track and report these transactions.   

222. Roe, as FAT’s CFO and SVP of finance, knew or was reckless in not 

knowing that FAT failed to track, report, and disclose reportable related person 

transactions, that Wiederhorn could transfer money from FAT at his own discretion, 

and that Wiederhorn made false statements to the FAT Board at April 2020 meetings 

regarding the purpose of the FAT loans to FCCG.  Roe was a signatory of the 

Intercompany Agreement and attended the April 14, 2020 meeting wherein the FAT 

Board added an internal control requiring that any additional lending to FCCG be 

approved in advance by the FAT Board.  However, Roe did not take any steps take 

any steps to implement an internal accounting control system that prevented 

Wiederhorn from circumventing or violating the FAT Board’s internal control, 

despite being aware that Wiederhorn authorized loan amounts from FAT to FCCG 

beyond the limits approved by the FAT Board.   

223. Hershinger, as FAT’s CFO, knew or was reckless in not knowing that 

FAT failed to track, report, and disclose reportable related person transactions, that 

Wiederhorn could transfer money from FAT at his own discretion, and that 

Wiederhorn made false statements to the FAT Board at April 2020 meetings 

regarding the purpose of the FAT loans to FCCG.  Hershinger attended the April 14, 

2020 meeting wherein the FAT Board added an internal control requiring that any 

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additional lending to FCCG be approved in advance by the FAT Board.  However, 

Hershinger did not take any steps to implement an internal accounting control system 

that prevented Wiederhorn from circumventing or violating the FAT Board’s internal 

control, despite being aware that Wiederhorn authorized loan amounts from FAT to 

FCCG beyond the limits approved by the FAT Board.   

224. Hershinger was also aware that Wiederhorn signed director and officer 

questionnaires that made false and misleading statements about reportable related 

person transactions that would have allowed FAT to accurately track and report these 

transactions.   

T. The Statutory Period Has Been Tolled  

225. FAT, Wiederhorn, and Roe executed tolling agreements suspending the 

period for one year and sixty days.   

226. Hershinger executed tolling agreements in 2023 and 2024 suspending 

the period for five months and sixty days. 

FIRST CLAIM FOR RELIEF 

Fraud in Connection with the Purchase or Sale of Securities 

Violations of Exchange Act Section 10(b) and Rules 10b-5(a) and (c) Thereunder  

(against Wiederhorn) 

227. The SEC realleges and incorporates by reference paragraphs 1 through 

226 above.   

228. As alleged above, Wiederhorn engaged in a scheme to defraud between 

July 2018 and March 2021 by, among other things, directing Roe and the FAT cash 

managers to effectuate the Wiederhorn Personal Cash Transfers for his personal 

benefit and misleading the FAT Board, FAT’s auditors, and investors about the loans 

FAT was making to FCCG. 

229. As alleged above, Wiederhorn also engaged in a scheme to defraud 

between October 2017 and December 2019 by directing the Thayer Transactions, 

which alleviated and disguised FAT’s inability to pay its own bills.   

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230. Wiederhorn engaged in deceptive acts to create the false appearance of 

fact to further his schemes by not disclosing the Wiederhorn Personal Cash Transfers 

or the Thayer Transactions in his director and officer questionnaires and related party 

questionnaire and by lying to the FAT Board about the purpose of the loans from 

FAT to FCCG.  Wiederhorn also disseminated false statements by signing FAT 

company filings containing false and misleading representations about related person 

transactions.   

231. By engaging in the conduct described above, Defendant Wiederhorn, 

directly or indirectly, acting with scienter, by use of the means or instrumentalities of 

interstate commerce, or of the mails, or of a facility of a national securities exchange, 

in connection with the purchase or sale of a security: employed devices, schemes or 

artifices to defraud; or engaged in acts, practices, or courses of business which 

operated or would operate as a fraud or deceit upon another person. 

232. By engaging in the conduct described above, Defendant Wiederhorn, 

directly or indirectly, violated, and unless restrained and enjoined, will again violate, 

Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5(a) and (c) 

thereunder [17 C.F.R. § 240.10b-5(a) and (c)]. 

SECOND CLAIM FOR RELIEF 

Fraud in Connection with the Offer and Sale of Securities 

Violations of Securities Act Section 17(a)(1) and (3) of the Securities Act  

(against Wiederhorn) 

233. The SEC realleges and incorporates by reference paragraphs 1 through 

226 above. 

234. As alleged above, Wiederhorn engaged in a scheme to defraud between 

July 2018 and March 2021 by, among other things, directing Roe and the FAT cash 

managers to effectuate the Wiederhorn Personal Cash Transfers for his personal 

benefit and misleading the FAT Board, FAT’s auditors, and investors about the loans 

FAT was making to FCCG. 

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235. As alleged above, Wiederhorn also engaged in a scheme to defraud 

between October 2017 and December 2019 by directing the Thayer Transactions, 

which alleviated and disguised FAT’s inability to pay its own bills.   

236. Wiederhorn engaged in deceptive acts to create the false appearance of 

fact to further his schemes by not disclosing the Wiederhorn Personal Cash Transfers 

or the Thayer Transactions in his director and officer questionnaires and related party 

questionnaire and by lying to the FAT Board about the purpose of the loans from 

FAT to FCCG.  Wiederhorn also disseminated false statements by signing FAT 

company filings containing false and misleading representations about related person 

transactions.   

237. In connection with the scheme, Wiederhorn realized ill-gotten gains in 

the form of Wiederhorn Personal Transfers funded by loans from FAT which were 

never repaid. 

238. At all relevant times and as alleged above, Wiederhorn acted with 

scienter, or in the alternative, was negligent. 

239. By engaging in the conduct described above, Defendant Wiederhorn, 

directly or indirectly, in the offer or sale of securities by the use of means or 

instruments of transportation or communication in interstate commerce or by use of 

the mails employed devices, schemes, or artifices to defraud; or engaged in 

transactions, practices, or courses of business which operated or would operate as a 

fraud or deceit upon the purchaser. 

240. By engaging in the conduct described above, Defendant Wiederhorn 

violated, and unless restrained and enjoined will continue to violate, Sections 17(a)(1) 

and 17(a)(3) of the Securities Act, 15 U.S.C. §§ 77q(a)(1) & 77q(a)(3). 

/// 

/// 

/// 

/// 

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THIRD CLAIM FOR RELIEF 

Aiding and Abetting Wiederhorn’s Violations of Exchange Act Section 10(b) and 

Rules 10b-5(a) and (c) Thereunder and Securities Act Sections 17(a)(1) and (3)  

(against Roe) 

241. The SEC realleges and incorporates by reference paragraphs 1 through 

226 above.   

242. As alleged above, from October 2017 to December 2020, Roe 

substantially assisted Wiederhorn’s scheme by, among other things, overseeing the 

FAT cash management team and directing to which of Wiederhorn’s accounts to send 

FAT funds and effectuating many of the transfers himself.  Despite being an 

executive officer of FAT, and knowing all the details about the Wiederhorn transfers 

and the Thayer Transactions, Roe did not inform the FAT Board when he knew, or 

was reckless in not knowing, that Wiederhorn misled them about how the proceeds of 

FAT’s loans to FCCG were being used. Roe also reviewed, revised, and signed 

FAT’s 2017 Form 10-K, thereby substantially assisting Wiederhorn in disseminating 

false and misleading statements which concealed Wiederhorn’s scheme.   

243. By engaging in the conduct described above, Defendant Roe knowingly 

and recklessly provided substantial assistance to, and thereby aided and abetted 

Wiederhorn in his violations of Section 10(b) of the Exchange Act [15 U.S.C. § 

78j(b)] and Rules 10b-5(a) and (c) thereunder [17 C.F.R. § 240.10b-5(a) and (c)] and 

Sections 17(a)(1) and 17(a)(3) of the Securities Act, 15 U.S.C. §§ 77q(a)(1) & 

77q(a)(3). 

244. Unless restrained and enjoined, Roe is reasonably likely to continue to 

aid and abet, violations of Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] 

and Rules 10b-5(a) and (c) thereunder [17 C.F.R. § 240.10b-5(a) and (c)] and 

Sections 17(a)(1) and 17(a)(3) of the Securities Act, 15 U.S.C. §§ 77q(a)(1) & 

77q(a)(3). 

/// 

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FOURTH CLAIM FOR RELIEF 

Materially False or Misleading Statements  

in Connection With the Purchase or Sale of Securities 

Violation of Section 10(b) and Rule 10b-5(b) Thereunder  

(against Wiederhorn, FAT, Roe, and Hershinger) 

245. The SEC realleges and incorporates by reference paragraphs 1 through 

226 above. 

246. As alleged above, among other filings, Wiederhorn made (1) affirmative 

false and misleading statements regarding related person transactions in connection 

with the Thayer Transactions in FAT’s Forms 10-K for fiscal years 2017 through 

2019; (2) affirmative false and misleading statements regarding related person 

transactions in connection with the Wiederhorn Personal Cash Transfers in FAT’s 

Forms 10-K for fiscal years 2017 through 2020; and (3) affirmative false and 

misleading statements regarding the use of proceeds in FAT’s Forms 10-K for fiscal 

years 2018, 2019, and 2020, and Forms 10-Q for Q1, Q2, and Q3 2029, and Q1, Q2, 

and Q3 2020.  Wiederhorn signed each of these company filings.   

247. As alleged above, Roe made affirmative false and misleading statements 

in FAT’s 2017 Form 10-K regarding related person transactions in connection with 

the Thayer Transactions.  Roe signed this filing. 

248. As alleged above, Hershinger made affirmative false and misleading 

statements regarding related person transactions in connection with the Wiederhorn 

Personal Cash Transfers and Thayer Transactions in FAT’s 2019 Form 10-K and its 

July 2020 Form S-1 Registration Statement that incorporated the relevant section of 

the 2019 Form 10-K by reference, and regarding the Wiederhorn Cash Transfers in 

FAT’s 2020 Form 10-K.  Hershinger signed each of these filings. 

249. As set forth above, these affirmative false and misleading statements 

were material and made in connection with the purchase or sale of securities. 

250. Wiederhorn, Roe, and Hershinger made these statements with scienter 

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because they knew, or were reckless in not knowing, that the representations 

regarding related person transactions were false and misleading. 

251. Wiederhorn’s, Roe’s, and Hershinger’s scienter is imputed to FAT, of 

which they were acting as its CEO or CFOs, respectively. 

252. By engaging in the conduct described above, Defendants Wiederhorn, 

Roe, Hershinger, and FAT directly or indirectly, in the offer or sale of securities, and 

by the use of means or instruments of transportation or communication in interstate 

commerce or by use of the mails directly or indirectly, made an untrue statement of 

material fact or omitted to state a material fact necessary in order to make the 

statements made, in light of the circumstances in which they were made, not 

misleading.   

253. By engaging in the conduct described above, Defendants Wiederhorn, 

Roe, Hershinger, and FAT violated, and unless restrained and enjoined will continue 

to violate, Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b), and Rule 10b-5(b) 

thereunder, 17 C.F.R. §§ 240.10b-5(b). 

FIFTH CLAIM FOR RELIEF 

Materially False or Misleading Statements  

in Connection With the Offer and Sale of Securities 

Violation of Section 17(a)(2) of the Securities Act  

(against FAT) 

254. The SEC realleges and incorporates by reference paragraphs 1 through 

226 above. 

255. As alleged above, among other filings, FAT’s (1)  Forms 10-K for fiscal 

years 2017 through 2019 contained affirmative false and misleading statements 

regarding related person transactions in connection with the Thayer Transactions; (2) 

Forms 10-K for fiscal years 2017 through 2020 contained affirmative false and 

misleading statements regarding related person transactions in connection with the 

Wiederhorn Personal Cash Transfers; and (3) Forms 10-K for fiscal years 2018-2020 

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and Forms 10-Q for Q1-Q3 2019 and Q1-Q3 2020 contained affirmative false and 

misleading statements regarding the use of proceeds.   

256. These affirmative false and misleading statements were made or 

incorporated by reference in FAT’s September 2019 Regulation A offering and July 

2020 Form S-1 offering and were therefore in connection with the offer or sale of 

securities. Through these false and misleading statements, FAT received 

approximately $1,077,000 in proceeds through its September 2019 offering pursuant 

to Regulation A, and approximately $8,021,000 through its July 2020 offering 

pursuant to Form S-1. 

257. As set forth above, these false and misleading statements were material 

and made in connection with the offer or sale of securities. 

258. Wiederhorn signed each of these company filings.  Wiederhorn made 

these statements with scienter, or at least negligence, because he knew, or were 

reckless in not knowing, that the representations regarding related person transactions 

and use of proceeds were false and misleading.   

259. Hershinger signed the Company’s July 2020 Form S-1 Registration 

Statement while knowing, being reckless in not knowing, or being at least negligent, 

that the Form S-1 contained materially false statements regarding related person 

transactions.   

260. Wiederhorn’s and Hershinger’s scienter and/or negligence are imputed 

to FAT, as they were acting as the Company’s CEO and CFO, respectively. 

261. By engaging in the conduct described above, Defendant FAT directly or 

indirectly, in the offer or sale of securities by the use of means or instruments of 

transportation or communication in interstate commerce or by use of the mails, 

obtained money or property by means of untrue statements of a material fact or by 

omitting to state a material fact necessary in order to make the statements made, in 

light of the circumstances under which they were made, not misleading. 

262. By engaging in the conduct described above, Defendant FAT violated, 

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and unless restrained and enjoined will continue to violate, Section 17(a)(2) of the 

Securities Act, 15 U.S.C. §§ 77q(a)(2). 

SIXTH CLAIM FOR RELIEF 

Aiding and Abetting FAT’s Violation of Section 17(a)(2) of the Securities Act 

(against Wiederhorn and Hershinger) 

263. The SEC realleges and incorporates by reference paragraphs 1 through 

226 above. 

264. As alleged above, Wiederhorn substantially assisted FAT’s violation of 

Section 17(a)(2) by signing the Company’s 2019 offering document pursuant to 

Regulation A and its July 2020 offering document pursuant to Form S-1 while 

knowing that the documents contained, or incorporated by reference, materially false 

and misleading statements regarding related person transactions and/or the use of 

proceeds. 

265. As alleged above, Hershinger also substantially assisted FAT’s violation 

of Section 17(a)(2) by signing the Company’s July 2020 Form S-1 Registration 

Statement, while knowing, or being reckless in not knowing, that the Form S-1 

contained materially false statements regarding related person transactions and/or the 

use of proceeds. 

266. By engaging in the conduct described above, Defendants Wiederhorn 

and Hershinger knowingly or recklessly provided substantial assistance to, and 

thereby aided and abetted FAT in its violation of Section 17(a)(2) of the Securities 

Act, 15 U.S.C. §§ 77q(a)(2). 

267. By engaging in the conduct described above, Defendants Wiederhorn 

and Hershinger aided and abetted, and unless restrained and enjoined, is reasonably 

likely to continue to aid and abet, violations of Section 17(a)(2) of the Securities Act, 

15 U.S.C. §§ 77q(a)(2). 

/// 

/// 

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SEVENTH CLAIM FOR RELIEF 

False Statements to Accountants 

Violation of Rule 13b2-2 of the Exchange Act 

(against Wiederhorn, Roe, and Hershinger) 

268. The SEC realleges and incorporates by reference paragraphs 1 through 

226 above. 

269. As alleged above, Wiederhorn knowingly made false statements in the 

related party questionnaire he signed and provided to FAT’s auditors in connection 

with the 2018 audit. In addition, Wiederhorn, Roe, and Hershinger all signed 

representation letters falsely stating that all information concerning related-party 

relationships had been disclosed despite knowing, or recklessly not knowing, about 

the Wiederhorn transfers or the Thayer Transactions, and, for Hershinger and 

Wiederhorn, the Wiederhorn Children salaries. 

270. Wiederhorn also knowingly (1) falsely told FAT’s 2019 auditor that 

expenses Wiederhorn initially identified in as “AW personal” were instead FCCG 

business expenses; (2) falsely told FAT’s 2019 auditor that FCCG used the loans 

from FAT to FCCG to pay legacy liabilities and business expenses; and (3) any 

payments by FAT of Wiederhorn’s personal credit card charges were because the 

amounts due were business expenses of FCCG.  

271. As alleged above, Roe knowingly misled FAT’s auditors in connection 

with the 2017 Company audit regarding the Thayer Transactions and Wiederhorn 

Personal Cash Transfers by identifying only FCCG as a related person to FAT in 

interviews.  In September and October 2020, Roe also made false representations to 

FCCG’s auditors regarding documents which he misrepresented evidenced that 

FCCG’s board of directors had fully approved loans from FCCG to Wiederhorn, 

which were never approved by the FCCG board.  

272. Hershinger knowingly told the auditors that the Wiederhorn Children 

Salaries had already been disclosed when, in fact, they had not.  

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273. By engaging in the conduct described above, Defendants Wiederhorn, 

Roe, and Hershinger, directly or indirectly:  (1) made or caused to be made a 

materially false and misleading statement to an accountant in connection with:  (i) 

any audit, review or examination of the financial statements of the issuer required to 

be made under the federal securities laws; or (ii) the preparation or filing of any 

document or report required to be filed with the SEC; or (2) omitted to state, or 

caused another person to omit to state, any material fact necessary in order to make 

statements made, in light of the circumstances under which such statements were 

made, not misleading, to an accountant in connection with:  (i) any audit, review or 

examination of the financial statements of the issuer required to be made under the 

federal securities laws; or (ii) the preparation or filing of any document or report 

required to be filed with the SEC. 

274. By engaging in the conduct described above, Defendants Wiederhorn, 

Roe, and Hershinger violated, and unless restrained and enjoined will continue to 

violate Rule 13b2-2 of the Exchange Act, 17 C.F.R. § 240.13b2-2. 

EIGHTH CLAIM FOR RELIEF 

False Sarbanes-Oxley Certification 

Violation of Rule 13a-14 of the Exchange Act 

(against Wiederhorn, Roe, and Hershinger) 

275. The SEC realleges and incorporates by reference paragraphs 1 through 

226 above. 

276. As alleged above, Wiederhorn, as the Chief Executive Officer of FAT, 

reviewed, approved, signed, and certified each of FAT’s Forms 10-K for fiscal years 

2017-2020 and each of FAT’s Forms 10-Q for Q1-Q4 2019 and Q1-Q3 2020.  Roe, 

as the Chief Financial Officer of FAT, reviewed, approved, signed, and certified the 

FAT Form 10-K for fiscal year 2017.  Hershinger, as the Chief Financial Officer of 

FAT, reviewed, approved, signed, and certified the FAT Form 10-Ks for fiscal years 

2018-2020.   

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277. These certifications were false because these filings contained material 

misrepresentations and omissions about related person transactions and/or the use of 

proceeds. 

278. By engaging in the conduct described above, Defendants Wiederhorn, 

Roe, and Hershinger falsely certified periodic reports containing financial statements 

filed by an issuer in violation of Section 13(a) of the Exchange Act and Rule 13a-14 

thereunder. 

279. By engaging in the conduct described above, Defendants Wiederhorn, 

Roe, and Hershinger violated, and unless restrained and enjoined will continue to 

violate, Rule 13a-14 of the Exchange Act, 17 C.F.R. § 240.13a-14.  

NINTH CLAIM FOR RELIEF 

False SEC Filings 

Violations of Section 13(a) of the Exchange Act and  

Rules 12b-20, 13a-1 and 13a-13 Thereunder 

(against FAT) 

280. The SEC realleges and incorporates by reference paragraphs 1 through 

226 above. 

281. As alleged above supra in Section N of this Complaint, FAT, which was 

an issuer of securities registered pursuant to Section 12 of the Exchange Act, filed 

annual Forms 10-K and quarterly Forms 10-Q containing misrepresentations and 

omissions about related person transactions and/or the use of proceeds.   

282. By doing so, FAT filed materially false and misleading quarterly reports, 

and materially false and misleading annual reports with the SEC that made untrue 

statements of material fact or omitted to state material facts necessary in order to 

make the statements made, in light of the circumstances under which they were made, 

not misleading, in violation of Section 13(a) of the Exchange Act and Rules 12b-20, 

13a-1, and 13a-13. 

283. By engaging in the conduct described above, Defendant FAT violated, 

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and unless restrained and enjoined will continue to violate, Section 13(a) of the 

Exchange Act and Rules 12b-20, 13a-1, and 13a-13. 

TENTH CLAIM FOR RELIEF 

Aiding and Abetting FAT’s Violations of Section 13(a) of the Exchange Act and 

Rules 12b-20, 13a-1 and 13a-13 Thereunder  

(against Wiederhorn) 

Rules 12b-20 and 13a-1 Thereunder 

(against Roe and Hershinger) 

284. The SEC realleges and incorporates by reference paragraphs 1 through 

226 above. 

285. As alleged above, Wiederhorn, Roe, and Hershinger substantially 

assisted FAT’s primary violations by signing certain Company filings during the 

Relevant Period. Wiederhorn signed FAT’s Forms 10-K for fiscal years 2017-2020. 

Roe signed the 2017 Form 10-K, and Hershinger signed the Forms 10-K for fiscal 

years 2018, 2019, and 2020. 

286. As alleged above, Wiederhorn signed each of FAT’s Forms 10-Q for 

Q1-Q3 2019 and Q1-Q3 2020.  

287. Each of the defendants knew or was reckless in not knowing that the 

filings they signed contained false and misleading statements about FAT’s related 

person transactions and/or the use of proceeds. 

288. By engaging in the conduct described above, Defendants Wiederhorn, 

Roe, and Hershinger each aided and abetted the reporting violations of FAT in that 

they knowingly or recklessly provided substantial assistance to FAT in committing 

these reporting violations. 

289. By engaging in the conduct described above, Defendant Wiederhorn 

aided and abetted FAT’s violations of, and, unless restrained and enjoined, will again 

aid and abet, violations of Section 13(a) of the Exchange Act and Rules 12b-20, 13a-

1 and 13a-13 thereunder. 

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290. By engaging in the conduct described above, Defendants Roe and 

Hershinger aided and abetted FAT’s violations of Section 13(a) of the Exchange Act 

and Rules 12b-20 and 13a-1 thereunder. 

291. Unless restrained and enjoined, Defendants Roe and Hershinger are 

reasonably likely to again aid and abet, violations of Section 13(a) of the Exchange 

Act and Rules 12b-20 and 13a-1 thereunder. 

ELEVENTH CLAIM FOR RELIEF 

Failure to Maintain Accurate Books and Records 

Violation of 13(b)(2)(A) of the Exchange Act 

(against FAT, and Wiederhorn, Roe, and Hershinger for Aiding and Abetting) 

292. The SEC realleges and incorporates by reference paragraphs 1 through 

226 above. 

293. As alleged above, FAT failed to make and keep books and records that 

accurately reflected the reportable related person transactions and failed to track and 

report Wiederhorn’s direct or indirect material interest in the loans from FAT to 

FCCG. 

294. As alleged above, Wiederhorn, Roe, and Hershinger aided and abetted 

FAT’s violations by failing to maintain accurate books and records in tracking 

reportable related person transactions and failing to ensure that FAT’s loans to FCCG 

were made with proper approvals. 

295. By the date of FAT’s Form 2017 10-K, Wiederhorn knew or was 

reckless in not knowing that FAT had failed to track, report, and disclose reportable 

related person transactions relating to the Wiederhorn Personal Cash Transfers and 

the Thayer Transactions.  Wiederhorn substantially assisted FAT’s violations by, 

among other things, signing director and officer questionnaires and a related party 

questionnaire that made false and misleading statements about reportable related 

person transactions that would have allowed FAT to accurately track and report such 

transactions.   

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296. By the date of FAT’s Form 2017 10-K, Roe knew that Wiederhorn was 

using most of the money FAT transferred to FCCG for the Wiederhorn Personal Cash 

Transfers and also knew that the Thayer Transactions amounted to over $120,000 for 

2017.  Roe substantially assisted FAT’s violations by, among other things, concealing 

the Wiederhorn Personal Cash Transfers and the Thayer Transactions as related party 

transactions during interviews with the auditors, as well as concealing the true 

purpose of those transactions.  In addition, Roe failed to disclose to auditors in 

management representation letters that the Wiederhorn Personal cash Transfers and 

the Thayer Transactions were related party transactions.   

297. By May 2019, Hershinger knew that Wiederhorn was using FAT’s loans 

to FCCG on his personal expenses.  She substantially assisted FAT’s violations by, 

among other things, accepting Wiederhorn’s representations in his director and 

officer questionnaires for fiscal years 2019 and 2020 when she knew, or was reckless 

in not knowing, that those representations were false and misleading.  

298. By engaging in the conduct described above, FAT violated, and unless 

restrained and enjoined, will continue to violate Section 13(b)(2)(A) of the Exchange 

Act, 15 U.S.C. § 78m(b)(2)(A). 

299. By engaging in the conduct described above, Defendants Wiederhorn, 

Roe, and Hershinger knowingly and recklessly provided substantial assistance to, and 

thereby aided and abetted FAT in its violations of Section 13(b)(2)(A) of the 

Exchange Act, and unless restrained and enjoined, is reasonably likely to continue to 

aid and abet violations of Section 13(b)(2)(A) of the Exchange Act, 15 U.S.C. § 

78m(b)(2)(A).  

TWELFTH CLAIM FOR RELIEF 

Failure to Devise a System of Internal Accounting Controls 

Violation of 13(b)(2)(B) of the Exchange Act 

(against FAT, and Wiederhorn, Roe, and Hershinger for Aiding and Abetting) 

300. The SEC realleges and incorporates by reference paragraphs 1 through 

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226 above. 

301. As alleged above, FAT failed to maintain a system of internal 

accounting controls sufficient to provide reasonable assurances that access to assets 

was consistent with management authorization.  The Company allowed Wiederhorn 

to have complete control over FAT’s accounts and to direct the transfers to the cash 

team, often without Board authorization.  

302. Wiederhorn, Hershinger, and Roe aided and abetted FAT’s violation by 

failing to devise and maintain an internal accounting control system to ensure FAT 

tracked reportable related person transactions and failing to ensure that FAT’s loans 

to FCCG were made with proper approvals.   

303. Beginning in or around May 2019 until December 2020, Wiederhorn 

knowingly or recklessly misled the FAT Board by representing that the loans from 

FAT to FCCG were solely for FCCG’s business expenses.  Wiederhorn also signed 

officer and director questionnaires that contained false and misleading statements 

about reportable related person transactions that would have allowed the Company to 

accurately track and report those transactions. 

304. Similarly, Roe and Hershinger knew or were reckless in not knowing 

that FAT failed to track, report, and disclose reportable related person transactions 

relating to Wiederhorn’s ability to transfer money from FAT at his sole discretion and 

his concealment of the Wiederhorn Personal Cash Transfers from the FAT Board.  

For Roe, despite managing the FAT cash management team and his integral role in 

recording FAT’s loans to FCCG, he failed to track, report, and disclose the 

Wiederhorn Personal Cash Transactions and Thayer Transactions.  Hershinger 

substantially assisted FAT’s violations by accepting Wiederhorn’s representations in 

his officer and director questionnaires for fiscal years 2019 and 2020 when she knew 

that they were false and misleading.  Moreover, despite knowing about the 

Wiederhorn Personal Cash Transfers and Thayer Transactions during this period, she 

failed to ensure that these transactions were tracked, reported and disclosed as 

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reportable related person transactions. 

305. By engaging in the conduct described above, FAT violated, and unless 

restrained and enjoined will continue to violate, Section 13(b)(2)(B) of the Exchange 

Act, 15 U.S.C. § 78m(b)(2)(B).   

306. By engaging in the conduct described above, Defendants Wiederhorn, 

Hershinger, and Roe knowingly and recklessly provided substantial assistance to, and 

thereby aided and abetted FAT’s violation of Section 13(b)(2)(B) of the Exchange 

Act, and unless restrained and enjoined, is reasonably likely to continue to aid and 

abet violations of Section 13(b)(2)(B) of the Exchange Act, 15 U.S.C. § 

78m(b)(2)(B).     

THIRTEENTH CLAIM FOR RELIEF 

Circumventing Internal Controls  

Violation of Section 13(b)(5) of the Exchange Act  

(against Wiederhorn) 

307. The SEC realleges and incorporates by reference paragraphs 1 through 

226 above. 

308. As alleged above, Wiederhorn violated Section 13(b)(5) during the 

second, third, and fourth quarters of 2020.  In April 2020, after learning that 

Wiederhorn could lend FAT’s money to FCCG “at no limit without board approval,” 

FAT’s Board put controls in place by requiring advance board approval for any 

additional lending by FAT to FCCG. Wiederhorn ignored and circumvented this 

control and continued to lend FAT money to FCCG in the second, third, and fourth 

quarters of 2020 in excess of the amounts approved by FAT’s Board.  

309. As alleged above, Wiederhorn personally benefitted from this 

unauthorized lending through the Wiederhorn Personal Cash Transfers.   

310. By engaging in the conduct described above, Wiederhorn violated, and 

unless restrained and enjoined, is reasonably likely to continue to violate, Section 

13(b)(5) of the Exchange Act, 15 U.S.C. § 78m(b)(5). 

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FOURTEENTH CLAIM FOR RELIEF 

Falsifying Books and Records 

Violation of Rule 13b2-1 of the Exchange Act 

(against Wiederhorn) 

311. The SEC realleges and incorporates by reference paragraphs 1 through 

226 above. 

312. As alleged above, Wiederhorn violated Rule 13b2-1 by signing 

director and officer questionnaires that made false and misleading statements 

about reportable related person transactions that would have allowed FAT to 

accurately track and report those transactions. 

313. By engaging in the conduct described above, Wiederhorn violated, and 

unless restrained and enjoined, is reasonably likely to continue to violate, Exchange 

Act Rule 13b2-1, 17 C.F.R. § 240.13b2-1. 

FIFTEENTH CLAIM FOR RELIEF 

Solicitation of Proxies in Violation of Rules and Regulations 

Violation of Section 14(a) of the Exchange Act and  

Rules 14a-3 and 14a-9 Thereunder 

(against FAT and Wiederhorn) 

314. The SEC realleges and incorporates by reference paragraphs 1 through 

226 above. 

315. As alleged above, FAT’s proxy statements that it used to solicit proxies 

in connection with its 2018 through 2020 annual meetings for the election of 

directors, including Wiederhorn in 2020, contained false and misleading statements 

regarding FAT’s reportable related person transactions with Wiederhorn and Thayer.   

316. In addition, FAT’s proxy statements for 2018 and 2019, contained false 

and misleading statements regarding the Wiederhorn Personal Cash Transfers and 

Thayer Transactions, as well as the Wiederhorn Children Salaries.   

317. Wiederhorn signed these proxy statements despite knowing they 

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contained false and misleading statements.  

318. By engaging in this conduct, Wiederhorn acted at least negligently.   

319. As FAT’s founder, CEO, and director, Wiederhorn is directly liable for 

FAT’s proxy violations.  

320. By engaging in the conduct described above, Defendants FAT and 

Wiederhorn violated, and unless restrained and enjoined, are reasonably likely to 

continue to violate, Section 14(a) of the Exchange Act, 15 U.S.C. § 78n(a) and Rules 

14a-3and 14a-9 thereunder, 17 C.F.R. §§ 240.14a-3 and 14a-9. 

SIXTEENTH CLAIM FOR RELIEF 

Improper Personal Loans to FAT’s CEO 

Violation of Section 13(k) of the Exchange Act  

(against FAT, and Wiederhorn and Roe For Aiding and Abetting) 

321. The SEC realleges and incorporates by reference paragraphs 1 through 

226 above. 

322. As alleged above, from July 2018 to December 2020, Wiederhorn 

directed approximately $20 million from FAT to FCCG which were used for the 

Wiederhorn Personal Cash Transfers.  Wiederhorn used these funds to pay for private 

jets, first class airfare, luxury vacations, his rent and mortgage payments, shopping, 

and jewelry.   

323. The Wiederhorn Personal Cash Transfers were direct or indirect personal 

loans from FAT to Wiederhorn. 

324. Wiederhorn and Roe aided and abetted FAT’s violation.  Wiederhorn 

directed FAT’s cash team for each transaction between FAT and either FCCG or 

Wiederhorn that funded the Wiederhorn Personal Cash Transfers, and he knew that 

the transactions were for his personal benefit.  Roe similarly ensured Wiederhorn’s 

instructions were followed and trained the FAT cash team on using the FAT loans to 

fund the Wiederhorn Personal Cash Transfers. 

325. By engaging in the conduct described above, FAT violated, and unless 

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restrained and enjoined will continue to violate, Section 13(k) of the Exchange Act, 

15 U.S.C. § 78m(k).   

326. By engaging in the conduct described above, Defendants Wiederhorn 

and Roe knowingly and recklessly provided substantial assistance to, and thereby 

aided and abetted FAT’s violation of Section 13(k) of the Exchange Act, and unless 

restrained and enjoined, are reasonably likely to continue to aid and abet violations of 

Section 13(k) of the Exchange Act, 15 U.S.C. § 78m(k).     

PRAYER FOR RELIEF 

WHEREFORE, the SEC respectfully requests that the Court: 

I. 

Issue findings of fact and conclusions of law that Defendants committed the 

alleged violations. 

II. 

Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of 

Civil Procedure, permanently enjoining FAT and its officers, agents, servants, 

employees and attorneys, and those persons in active concert or participation with 

any of them, who receive actual notice of the judgment by personal service or 

otherwise, and each of them, from violating Section 17(a)(2) of the Securities Act, 

Sections 10(b), 13(a), 13(b)(2)(A), 13(b)(2)(B), 13(k), and 14(a) of the Exchange 

Act, and Rules 10b-5(b), 12b-20, 13a-1, 13a-13, 14a-3, and 14a-9 thereunder. 

III. 

Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of 

Civil Procedure, permanently enjoining Wiederhorn and his officers, agents, servants, 

employees and attorneys, and those persons in active concert or participation with 

any of them, who receive actual notice of the judgment by personal service or 

otherwise, and each of them, from violating 17(a)(1) and 17(a)(3) of the Securities 

Act, 10(b), 13(b)(5), and 14(a) of the Exchange Act, and Rules 10b-5, 13a-14, 13b2-

1, 13b2-2, 14a-3 and 14a-9 thereunder; and aiding and abetting violations of 

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Securities Act Section 17(a)(2), Exchange Act Sections 13(a), 13(b)(2)(A), 

13(b)(2)(B), and 13(k) and Rules 12b-20, 13a-1, and 13a-13 thereunder. 

IV. 

Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of 

Civil Procedure, permanently enjoining Roe and his officers, agents, servants, 

employees and attorneys, and those persons in active concert or participation with 

any of them, who receive actual notice of the judgment by personal service or 

otherwise, and each of them, from violating Section 10(b) of the Exchange Act and 

Rules 10b-5(b), 13a-14, and 13b2-2 thereunder; aiding and abetting Wiederhorn’s 

primary violations of Securities Act Sections 17(a)(1) and (3), and Exchange Act 

Section 10(b) and Rules 10b-5(a) and (c) thereunder; and aiding and abetting 

violations of Exchange Act Sections 13(a), 13(b)(2)(A), 13(b)(2)(B), 13(k), and Rules 

12b-20 and 13a-1 thereunder. 

V. 

Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of 

Civil Procedure, permanently enjoining Hershinger and her officers, agents, servants, 

employees and attorneys, and those persons in active concert or participation with 

any of them, who receive actual notice of the judgment by personal service or 

otherwise, and each of them, from violating Section 10(b) of the Exchange Act and 

Rules 10b-5(b), 13a-14, and 13b2-2 thereunder; and aiding and abetting violations of 

Section 17(a)(2) of the Securities Act and Sections 13(a), 13(b)(2)(A) and 

13(b)(2)(B) of the Exchange Act, and Rules 12b-20 and 13a-1 thereunder. 

VI. 

Issue an order, pursuant to Section 20(e) of the Securities Act, 15 U.S.C. § 

77t(e), and Sections 21(d)(2) of the Exchange Act, 15 U.S.C. § 78u(d)(2), prohibiting 

Wiederhorn, Roe, and Hershinger from acting as an officer or director of any issuer 

that has a class of securities registered pursuant to Section 12 of the Exchange Act, 15 

U.S.C. § 78l, or that is required to file reports pursuant to Section 15(d) of the 

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Exchange Act, 15 U.S.C. § 78o(d). 

VII. 

Order Defendants FAT and Wiederhorn to disgorge all funds received from 

their illegal conduct, together with prejudgment interest thereon. 

VIII. 

Order Defendants to pay civil penalties under Section 20(d) of the Securities 

Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the Exchange Act [15 U.S.C. § 

78u(d)(3)]. 

IX. 

Retain jurisdiction of this action in accordance with the principles of equity and 

the Federal Rules of Civil Procedure in order to implement and carry out the terms of 

all orders and decrees that may be entered, or to entertain any suitable application or 

motion for additional relief within the jurisdiction of this Court. 

X. 

Grant such other and further relief as this Court may determine to be just and 

necessary. 

Jury Demand  
 

The SEC demands trial by jury on liability. 

 

Dated:  May 10, 2024  

 /s/ Stephen T. Kam 
Stephen T. Kam 
Robert C. Stillwell 
Attorneys for Plaintiff 
Securities and Exchange Commission 

 

Case 2:24-cv-03913   Document 1   Filed 05/10/24   Page 59 of 59   Page ID #:59



Complaints and Other Initiating Documents
2:24-cv-03913 Securities and Exchange Commission v. FAT Brands, Inc. et al

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA

Notice of Electronic Filing

The following transaction was entered by Kam, Stephen on 5/10/2024 at 4:25 AM PDT and filed on 5/10/2024
Case Name: Securities and Exchange Commission v. FAT Brands, Inc. et al
Case Number: 2:24-cv-03913
Filer: Securities and Exchange Commission
Document Number:1

Docket Text:
COMPLAINT No Fee Required - US Government, filed by Plaintiff Securities and Exchange
Commission. (Attorney Stephen Tian Li Kam added to party Securities and Exchange
Commission(pty:pla))(Kam, Stephen)

2:24-cv-03913 Notice has been electronically mailed to:

Stephen Tian Li Kam     [email protected], [email protected], [email protected], [email protected],
[email protected], [email protected]

2:24-cv-03913 Notice has been delivered by First Class U. S. Mail or by other means BY THE FILER to :

The following document(s) are associated with this transaction:

Document description:Main Document
Original filename:C:\fakepath\FAT Complaint FINAL.pdf
Electronic document Stamp:
[STAMP cacdStamp_ID=1020290914 [Date=5/10/2024] [FileNumber=37901201-0
] [41c32e75cebe39763cb38a89bd0f1fdcc2e255b20258ae9764398c4924346872c69
234ee4faecba4a416507a632d325f901b56b3cb5872f5b6c1cc8f679507e7]]

https://ecf.cacd.uscourts.gov/cgi-bin/DktRpt.pl?925756
https://ecf.cacd.uscourts.gov/cgi-bin/DktRpt.pl?925756
https://ecf.cacd.uscourts.gov/doc1/031142389828?caseid=925756&de_seq_num=6&magic_num=MAGIC