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Zankou Chicken's tragic family rift impedes chain's growth

RESTAURANTS

A fatal dispute has left the popular chain divided into two factions. The chain, which once had international ambitions, remains confined to the Southland.

March 18, 2010|By Darrell Satzman
  • Vartkes Marjik, a grandson of Zankou Chicken's founders, at the branch he opened in Montebello. He also co-owns the original Zankou in Hollywood. Rita Iskenderian, his aunt, runs eight other branches.
Vartkes Marjik, a grandson of Zankou Chicken's founders, at the branch… (Irfan Khan / Los Angeles…)

Everyone loves Zankou Chicken.

Families line up at the little restaurant chain's counters for moderately priced rotisserie entrees. Critics as far away as New York have swooned over its secret garlic sauce, and the Zagat Guide has called its chicken dinner "the single best takeout dish in town."

Zankou was even mentioned in a Beck song, "Debra."

So why has expansion of the chain, which debuted in Hollywood in 1984 and once had dreams of spreading across the nation and even to Europe, been so tough?

Although there are signs that it's finally getting off the ground -- five more Zankous opened in Southern California in recent years, bringing the total to 10 -- it's a family-run business. And that family is at war, with two factions long in battle over the chain.

"Everybody is doing their business, but the relations are bad," said Rita Iskenderian, who, with her four sons, runs eight of the restaurants.

In 2003, the fight reached horrific proportions when her husband, the son of Zankou's founders, fatally shot his mother and sister.

Although the two sides now coexist, there is no real peace. And that's not a good recipe for expansion.

"I don't think things can be fixed," Iskenderian said. "There are too many bad feelings."

Chain restaurants depend on a strong central core that demands uniformity in the branches.

"The danger is if they don't meet up to customers' expectations -- if they have different prices or different recipes," said Bonnie Riggs, a restaurant industry analyst with NPD Group.

"The customer doesn't know who owns what. They just want the same things when they go to any in the chain."

Even though the economy is far from robust, it could be a good time for a small chain to take the plunge.

"There are a lot of attractive locations right now that you can get in some very prime locations for next to nothing," said Brad Ludington, a senior restaurant analyst for KeyBanc Capital Markets Inc.

He thinks a chain like Zankou with Middle Eastern-inspired food could catch on in diverse metropolitan areas. But there's a heightened risk when moving beyond the traditional hamburger and fried chicken staples in a fast-casual chain.

"Chinese food has a very broad appeal; so does Mexican food," Ludington said. "But people haven't seen a multi-state chain doing this type of food before."

Zankou Chicken started humbly -- it was founded in Beirut in 1962 by Armenian couple Vartkes and Markrid Iskenderian. Their shop was tiny, but the tangy garlic sauce that Markrid invented distinguished it from the competition.

The couple eventually fled war-torn Lebanon and in 1984 opened the first Zankou in America on Sunset Boulevard in Hollywood. The oldest of their three children, Mardiros, worked with them in the restaurant and had ambitious plans to expand the operation, even to Paris. But his parents balked at the idea, and Mardiros struck out on his own, opening Zankou branches in Anaheim, Glendale, Pasadena and Van Nuys.

The business' patriarch, Vartkes, died in 1992. For several years, Mardiros and other members of the family fought over various aspects of the business, including the rights to the Zankou name.

The fight became increasingly bitter over the years. On the afternoon of Jan. 14, 2003, Mardiros drove to the home of his sister, Dzovig Marjik, 45. Their mother, Markrid, 75, was also there.

Rita Iskenderian said her husband, who was by then battling cancer, had wanted to settle family issues.

According to Glendale police statements, a loud argument was heard and shots were fired. Mardiros had used a handgun to shoot his sister and mother, and then turned the gun on himself. All three died at the scene.

Vartkes Marjik, now 29, lost his mother that day. But he has not cut himself off from Mardiros' side of the family.

"I still love my Aunt Rita and my cousins," said Marjik, who was named Vartkes after his grandfather. "But what their father did was unbelievable -- to kill your own mother and sister for a business."

Marjik and his brother inherited their mother's share of the first Zankou in Hollywood, which they continue to co-own with her sister, Haygan Iskenderian. Rita Iskenderian's family owns the Zankous that her husband opened.

The fight continued. Rita Iskenderian lost a court battle to take sole control of the trademark.

"What can we do? The judge made a mistake," she said. "You can't have one restaurant [chain] with two owners. Everything will be different. That doesn't mean the quality is bad; it's just different."

Both sides expanded the chain. Rita Iskenderian's part of the family opened branches in Toluca Lake, West Los Angeles and Burbank and a second Glendale location.

Vartkes Marjik opened a branch in Montebello, aiming to show that Zankou could be popular far from neighborhoods with sizable Armenian populations.

"We're doing great here in this location, and I strongly assume it's because of the name," Marjik said.

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