A Florida-based pet retailer that operated under the Three Dog Bakery brand has filed for bankruptcy protection amid a prolonged legal battle with its franchisor, according to court documents filed last week. The company, J.L.E.T. Enterprises, which operated specialty pet stores in Naples and Sarasota under names such as Lucy’s Dog Bakery & Spa and Three Dog Bakery & Grooming, submitted a Chapter 11 petition on January 15 in the U.S. Bankruptcy Court for the Middle District of Florida.
Founded in November 2016 by Joseph and Lynette Naughton, J.L.E.T. Enterprises carved out a niche in the competitive pet retail industry by offering freshly baked dog treats, custom canine celebration cakes, and professional grooming services. The company’s flagship location occupied 1,500 square feet at The Shoppes at University Town Center in Sarasota, where it gained a loyal following of pet owners drawn to its boutique offerings.
The North Port-based business reported assets ranging from $100,000 to $500,000, while liabilities were estimated between $1 million and $10 million, according to RK Consultants’ January 15 announcement on X. The filing listed between 50 and 99 creditors, underscoring the financial strain facing the company.
Three Dog Bakery, the franchisor, was founded in 1989 in Kansas City, Missouri, with a mission to create dog treats “worthy of the word ‘treat.’” Over the decades, the brand expanded into a franchise model, offering entrepreneurs the opportunity to operate pet bakeries and grooming businesses under its established name. However, the relationship between J.L.E.T. Enterprises and its franchisor soured last year, culminating in the termination of the franchise agreement in May 2025.
Following the termination, Three Dog Bakery filed suit against J.L.E.T. Enterprises in the Western District of Missouri. The franchisor accused the Florida-based company of trademark infringement and violating non-compete clauses after the Naughtons attempted to operate their stores independently. The legal battle added substantial financial and operational pressure on the company, contributing to its decision to seek bankruptcy protection.
J.L.E.T. Enterprises filed under Subchapter V of the bankruptcy code, a streamlined reorganization process tailored specifically for small businesses. This mechanism allows companies to submit a reorganization plan quickly, with fewer procedural hurdles than traditional Chapter 11 cases. According to court filings, the company operated under several names, including Lucy’s Dog Bakery & Spa, Three Dog Bakery & Grooming, and Diversified Services SWF, further complicating financial and legal obligations. Under the Subchapter V process, J.L.E.T. Enterprises is required to submit a reorganization plan by April 15, 2026.
The bankruptcy filing provides the company with an opportunity to restructure its debt, address mounting liabilities to landlords and legal counsel, and resolve ongoing disputes with its former franchisor. While the ultimate goal is to potentially continue operations in some form, the challenges are significant. The filing underscores the broader difficulties faced by small, independent pet retailers navigating a highly competitive industry dominated by national chains and online giants.
According to United Consumer Financial Services (UCFS), a subsidiary of Berkshire Hathaway, the pet retail sector faces stiff competition from companies such as Amazon, Walmart, Chewy, and Bark Box. These larger operators benefit from economies of scale, national distribution networks, and online platforms that appeal to cost-conscious consumers, placing pressure on smaller boutique retailers.
Despite intense competition, the U.S. pet market remains sizable. Roughly 70 percent of American households own pets, creating a large potential customer base for retailers like J.L.E.T. Enterprises. However, this opportunity is tempered by rising costs of pet ownership. A report from Rover, a pet services company, found that 43 percent of pet owners have noticed increases in basic expenses for their animals, and nearly one-quarter worry about the affordability of essential pet needs.
The regulatory environment also poses challenges for brick-and-mortar pet retailers. Four states—California, Illinois, New York, and Maryland—have banned the sale of pets in retail stores to combat puppy mills and other unethical breeding practices. Organizations such as the American Society for the Prevention of Cruelty to Animals have lauded these measures as protective of animal welfare, but they have added an extra layer of complexity and limitation for traditional pet retailers seeking to expand their offerings.
J.L.E.T. Enterprises’ bankruptcy filing reflects not only these external pressures but also the consequences of franchise agreements and legal disputes. When a franchise relationship dissolves, businesses often face immediate challenges including brand recognition loss, legal costs, and operational disruptions. In the case of J.L.E.T., the combination of litigation, debt, and competition has made it difficult to maintain financial viability without the protection of the bankruptcy court.
The Subchapter V process gives J.L.E.T. Enterprises 90 days to propose a reorganization plan that satisfies creditors while potentially allowing the company to continue some or all of its operations. While the outcome remains uncertain, the Naughtons appear committed to using the bankruptcy process strategically to stabilize their business and explore viable paths forward.
Industry experts note that while bankruptcy filings among small retailers are not uncommon, boutique pet businesses face particular vulnerabilities due to the specialized nature of their products, reliance on local markets, and limited financial reserves. In this context, even minor disruptions, such as legal disputes or franchise terminations, can trigger significant financial strain.
Despite these challenges, there is some optimism for companies that successfully navigate the Subchapter V process. By renegotiating debts, restructuring operations, and leveraging the bankruptcy framework to resolve outstanding litigation, small businesses can emerge more financially stable and better positioned for long-term survival. Whether J.L.E.T. Enterprises will be able to achieve this outcome remains to be seen, but the filing signals a proactive approach to addressing its financial and legal hurdles.
For the Naughtons, the filing represents both a practical step and a symbolic pivot. Their business, which once attracted pet owners seeking gourmet treats and high-end grooming services, now enters a critical period in which strategic decisions will determine its future. The bankruptcy court will oversee the process, ensuring that creditors’ claims are addressed while providing the company with an opportunity to restructure.
As the pet industry continues to evolve, small operators like J.L.E.T. Enterprises must contend with the dual pressures of competitive market forces and regulatory constraints. The company’s experience highlights the complex dynamics of franchising, the importance of legal compliance, and the financial vulnerabilities inherent in niche retail businesses.
The next few months will be decisive. J.L.E.T. Enterprises must develop a feasible plan that balances creditor claims with operational continuity, navigates ongoing litigation with its former franchisor, and identifies sustainable business strategies amid a rapidly changing pet retail landscape. Observers across the industry will be watching closely, as the outcome may provide a roadmap—or cautionary tale—for other small pet retailers facing similar challenges.
For now, the Naughtons and their team are focused on stabilizing the business under court supervision while exploring ways to protect their employees, preserve customer relationships, and potentially maintain a presence in Florida’s competitive pet retail market. The bankruptcy filing marks a turning point for the company, offering both an opportunity for recovery and a stark reminder of the risks facing small businesses in a crowded, high-pressure industry.
Emily Johnson is a critically acclaimed essayist and novelist known for her thought-provoking works centered on feminism, women’s rights, and modern relationships. Born and raised in Portland, Oregon, Emily grew up with a deep love of books, often spending her afternoons at her local library. She went on to study literature and gender studies at UCLA, where she became deeply involved in activism and began publishing essays in campus journals. Her debut essay collection, Voices Unbound, struck a chord with readers nationwide for its fearless exploration of gender dynamics, identity, and the challenges faced by women in contemporary society. Emily later transitioned into fiction, writing novels that balance compelling storytelling with social commentary. Her protagonists are often strong, multidimensional women navigating love, ambition, and the struggles of everyday life, making her a favorite among readers who crave authentic, relatable narratives. Critics praise her ability to merge personal intimacy with universal themes. Off the page, Emily is an advocate for women in publishing, leading workshops that encourage young female writers to embrace their voices. She lives in Seattle with her partner and two rescue cats, where she continues to write, teach, and inspire a new generation of storytellers.
