The lawsuit claims Outfox Hospitality failed to provide notice of mass layoffs or stores closing.
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The complaint seeks backpay and benefits for affected workers.
The two upscale grocery stores merged within the last six months.
There were two Dom's and 15 Foxtrot locations in Chicago.
The closures affected the two Dom's stores and 33 Foxtrots across the Chicago, Austin, Dallas and D.C. areas.
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Alexandra Meraz said Tuesday that employees were blindsided. She worked at the Foxtrot in Old Town for the past six months.
"I'm just really distraught because this was my livelihood; this was my only job," Meraz said. "It was a regular Tuesday, and now it's just you're out of a job."
Meraz said she clocked in to her shift Tuesday morning, and once managers came out of a meeting, she was told the store would be closing immediately, and that she needed to leave.
She said no reason was given, but said there was speculation of company financial troubles.
She's now scrambling to apply for unemployment.
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Faithful customers are wondering what happens next.
"I'm sorry to see this happening. It's probably going to leave quite a void in storefront spaces, and I'm more concerned about the people who work here," David Anthony Powell said.
Foxtrot and Dom's announced a merger in November and planned to operate under the name "Outfox Hospitality."