Chuck E Cheese

The animatronic band performs Wednesday at a Chuck E, Cheese’s in Chicago. The company’s remodeling includes “a calmer” environment, without the band.  (Brian Cassella/TNS)

Chuck E. Cheese is a chain of American restaurants. The chain is the primary brand of CEC Restaurant, Inc. and is headquartered in Irving, Texas. The establishment serves pizza and other menu items, complemented by arcade games, amusement rides, and animatronic displays as a focus of family entertainment. The restaurant’s name is taken from its main character and mascot Chuck E. Cheese.

Founder of Chuck E. Cheese's and Atari has award revoked after outcry over  sexually inappropriate behavior

Chuck E. Cheese’s Pizza Time Theatre was founded by Atari founder Nolan Bushnell, who was seeking to expand the purview of video game arcades beyond more adult locations like pool halls to a child- and family-friendly venue. Bushnell’s experience in the amusement park industry, as well as his fondness for Disneyland’s Country Bear Jamboree, were influential in the conceptualization Pizza Time Theatre. Bushnell has said of his decision to open a pizza restaurant, “It was my pet project … I chose pizza because of the wait time and the build schedule: very few components and not too many ways to screw it up.” After finding out from employees working on the animatronics that the costume he bought was a rodent rather than the coyote he thought he was buying, Bushnell says he suggested changing the name of the establishment from the planned “Coyote Pizza” to “Rick Rat’s Pizza”. Marketing people disliked that and proposed “Chuck E. Cheese” instead, which is what was used.

The first location opened in San Jose, California, in 1977, and was labeled as the first family restaurant to integrate food, cheap animated entertainment, and an indoor arcade. In 1978, when Atari’s then-corporate parent, Warner Communications refused to open additional Pizza Time Theatre locations, Bushnell purchased the rights to the concept and character trademarks from Warner for $500,000. Gene Landrum then resigned from Atari and was made President and chief operating officer of Chuck E. Cheese’s Pizza Time Theatre. By late 1979, Pizza Time Theatre was known to have seven open locations, all in California. Its animatronics were fully produced in-house by Pizza Time Theatre employees.

To expand beyond California and the west coast, Bushnell began to franchise, resulting in a co-development agreement between himself and Robert Brock of Topeka Inn Management in June 1979. The agreement handed Brock exclusive franchising rights for opening Pizza Time Theatres in sixteen states across the Southern and Midwestern United States, while also forming a company subdivision, “Pizza Show Biz”, to develop the Pizza Time Theatres.

Late in 1979, Brock became aware of Aaron Fechter of Creative Engineering, Inc. and his work in animatronics. In November 1979, he scouted Fechter’s business and concluded that Creative Engineering’s animatronics would be too strong a competition for Bushnell’s work. Brock therefore requested that Bushnell release him from their co-development agreement, wishing to develop with Fechter instead. In December 1979, Brock and Fechter formed Showbiz Pizza Place Inc., and Brock gave notice to sever his development relationship with Bushnell. ShowBiz Pizza Place was conceptually identical to Pizza Time Theatre in all aspects except for animation, which would be provided by Creative Engineering. Showbiz Pizza Place opened its first location on March 3, 1980, in Kansas City, Missouri.

Upon the opening of ShowBiz Pizza Place, Bushnell sued Brock and Topeka Inn Management over breach of contract. Brock immediately issued a counter-suit against Bushnell, citing misrepresentation. The court case began in March 1980, eventually settling out of court with Showbiz agreeing to pay Pizza Time Theatre a portion of its profits over the following decade. During this period, Topeka Inn Management also changed its name to Brock Hotel Corporation and moved its headquarters to Irving, Texas. Both restaurants experienced increased success as the video game industry became more robust, and, to maintain competition, both franchises continually modified and diversified their animatronic shows.

In 1981, Pizza Time Theatre went public; however, the evolving video game industry and the video game crash of 1983 resulted in significant losses for Pizza Time Theatre, which lost $15 million in 1983. By early 1984, Bushnell’s debts were insurmountable, resulting in the filing of Chapter 11 bankruptcy for Pizza Time Theatre Inc. on March 28, 1984. Showbiz then bought the foundering company, finalizing the purchase in May 1985 and recreating itself as Showbiz Pizza Time Inc.

After the merge, both restaurant chains continued operating under their respective titles, while major financial restructuring had begun. During this period, Creative Engineering began to sever ties with ShowBiz Pizza Time (officially splitting in September 1990), resulting in the unification of the two brands. By 1992, all restaurants assumed the name of Chuck E. Cheese’s Pizza. The name was then shortened to Chuck E. Cheese’s by March 1995 after a redesigned concept. In 1998, Showbiz Pizza Time renamed itself CEC Entertainment, Inc. to reflect the remaining chain brand. CEC Entertainment has since acquired additional family restaurant properties, including 13 locations of the now-defunct Discovery Zone in 1999, and all locations of Peter Piper Pizza in October 2014. Peter Piper Pizza still operates under that name.

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