We use cookies on this site to enable your digital experience. By continuing to use this site, you are agreeing to our cookie policy. close
Newsletter RSS

Mealey's Franchise

  • December 17, 2018

    Franchisor Claims Competitor Intentionally Interfered With Franchise Agreements

    RALEIGH, N.C. — A franchisor filed suit in North Carolina federal court on Dec. 7 against a competitor, claiming that the competitor intentionally interfered with its franchise agreements and is responsible for the franchisees’ defaulting on their obligations to the franchisor (General Nutrition Corp. v. Nutrition Zone Franchising Inc., d/b/a Nutrition Zone USA, No. 18-580, E.D. N.C.).

  • December 17, 2018

    Michigan McDonald’s Franchisee Hit With DOL Penalty For Child Labor Violations

    JACKSON, Mich. — A Michigan McDonald’s franchisee must pay $26,487 in penalties for child labor violations of the Fair Labor Standards Act (FLSA), the U.S. Department of Labor (DOL) announced on Dec. 4.

  • December 17, 2018

    Appeal Of Breach Of Contract Ruling In Favor Of Franchisor Is Voluntarily Dismissed

    ATLANTA — Pursuant to a motion to voluntarily dismiss, the 11th Circuit U.S. Court of Appeals on Dec. 11 dismissed franchisees’ appeal of a district court’s ruling that the franchisor did not breach the parties’ franchise agreements when it refused to approve the sale of the franchisees’ restaurants (Picktown Foods LLC, et al. v. Tim Hortons USA, Inc., No. 18-14337-JJ, 11th Cir.).

  • December 17, 2018

    $442,000 Default Judgment Recommended For GNC In Franchise Agreement Case

    PITTSBURGH — A Pennsylvania federal magistrate judge on Dec. 11 recommended that a default judgment of $442,000 be entered in favor of General Nutrition Corp. (GNC) regarding a company’s breach of a franchise agreement with the nutrition products retailer (General Nutrition Corp. v. K&R Nutrition Inc., et al., No. 18-1125, W.D. Pa., 2018 U.S. Dist. LEXIS 209671).

  • December 17, 2018

    Franchisees Ask High Court To Remand, Certify Issue To Virginia Supreme Court

    WASHINGTON, D.C. — A tax preparation franchisor on Dec. 12 waived its right to respond to a Dec. 4 petition for certiorari by former franchisees who assert that the Fourth Circuit U.S. Court of Appeals erred in failing to certify a question over the common-law requirements for contract consideration to the Virginia Supreme Court (Gregory Aime, et al. v. JTH Tax Inc., et al., No. 18-737, U.S. Sup.).

  • December 17, 2018

    Judgment Entered After Arbitrators Find Sales Representative Isn’t Franchise

    LOS ANGELES — A federal judge in California entered judgment on Nov. 16 after confirming an arbitration panel’s ruling that a sales representative for a cellular service company was not a franchise under California law because it did not pay a franchise fee (Unlimited Prepaid Inc. v. Air Voice Wireless Express LLC, et al., No. 2:17-CV-01409-SJO[JPRx], C.D. Calif.).

  • December 17, 2018

    9th Circuit Set To Hear Oral Arguments In Franchise Dispute Over California Law

    SAN FRANCISCO — Following the filing of supplemental briefs, the Ninth Circuit U.S. Court of Appeals is prepared to hear oral arguments on Dec. 18 regarding a motion to remand filed by three janitorial workers employed by franchisees of Jan-Pro Franchising International Inc. (JPI) (Gloria Roman, et al. v. Jan-Pro Franchising International Inc., No. 17-16096, 9th Cir.).

  • December 14, 2018

    Hardee’s Franchisee Agrees To Settle Hepatitis A Class Claims

    CHARLOTTE, N.C. — A North Carolina federal judge on Dec. 12 granted preliminary approval to a settlement by Hardee’s franchisee with locations in North Carolina and South Carolina to end class claims by customers who were possibly exposed to hepatitis A at one of its locations (Iafreedre McClain, et al. v. Morning Star, LLC, No. 18-419, E.P., et al. v. CKE Restaurants Holdings, Inc., et al., No. 18-483, W.D. N.C., 2018 U.S. Dist. LEXIS 209543)

  • December 14, 2018

    Judge: District Court Lacks Jurisdiction Over Franchise’s Trade Secrets Dispute

    CAMDEN, N.J. — A federal judge in New Jersey on Dec. 10 ruled that a franchiser failed to sufficiently show that defendants in a trade secret misappropriation lawsuit developed a competing business with the intent to harm the franchiser in New Jersey, and, as a result, the court lacks specific jurisdiction over the franchiser’s claims (Frutta Bowl Franchising LLC v. Justin Bitner, et al., No. 18-2446, D. N.J., 2018 U.S. Dist. LEXIS 208311).

  • December 13, 2018

    Judge Grants Franchisor’s Motion To Compel Arbitration, Stay Suit With Franchisees

    PORTLAND, Maine — A Maine federal judge on Dec. 11 granted a day care provider franchisor’s motion to compel arbitration and to stay its lawsuit against former franchisees pending arbitration, finding the issues raised by the franchisor are subject to arbitration because the parties’ dispute arose from their contract and because the franchise agreement’s arbitration clause, as written, “fairly implies that postexpiration disputes will be submitted to arbitration” (Toddle Inn Franchising, LLC v. KPJ Associates LLC, et al., No. 18-00293, D. Maine, 2018 U.S. Dist. LEXIS 208442).

  • December 13, 2018

    Subway Franchisee Will Pay $80,000 To Settle EEOC Sexual Harassment Suit

    NEW YORK — A New York Subway franchisor will pay $80,000 to settle claims by the Equal Employment Opportunity Commission that a former general manager offered two female applicants who were 17 at the time jobs in exchange for sex, according to a consent decree filed Dec. 10 in a New York federal court (Equal Employment Opportunity Commission v. Draper Development LLC, No. 15-877, N.D. N.Y.).

  • December 12, 2018

    Former Employee Alleges Sherman Act Violations Against Jiffy Lube Franchisors

    PHILADELPHIA — In a Nov. 29 complaint filed in a Pennsylvania federal court, a former Jiffy Lube employee accuses franchisors of the car repair servicing company of violating Section 1 of the Sherman Act through the use of a no-poach provision that harmed employees by suppressing their wages (Victor Fuentes v. Royal Dutch Shell PLC, et al., No. 18-5174, E.D. Pa.).

  • December 10, 2018

    Judge Adopts Recommendation Finding Failure To Pay Breached Franchise Agreements

    SAN JUAN, Puerto Rico — A federal judge in Puerto Rico on Nov. 20 adopted a magistrate judge’s Oct. 30 report and recommendation to grant in part a franchisor’s motion for partial summary judgment seeking declaratory judgment, holding that the franchisees’ failure to pay costs required by their franchise agreement warranted termination of the agreement and an order requiring them to pay rent payments, fee payments and other product payments (Total Petroleum Puerto Rico Corp. v. Rafael Fonseca-Marrero, et al., No. 16-2436, D. Puerto Rico, 2018 U.S. Dist. LEXIS 197986).

  • December 6, 2018

    Judge Dismisses Infringement Claims Against Franchisor For Lack Of Jurisdiction

    PORTLAND — After holding that a franchisor did not have sufficient contacts to Oregon to establish jurisdiction there, an Oregon federal judge on Dec. 3 granted an apparel printing franchisor’s motion to dismiss claims for copyright infringement against it for lack of jurisdiction (Lisa Fox v. Michael Berenis, et al., No. 3:17-cv-2066, D. Ore., 2018 U.S. Dist. LEXIS 203859).

  • December 6, 2018

    Class Certified In Suit Over Pizza Hut Franchisee’s Unwanted Text Messages

    WEST PALM BEACH, Fla. — A Florida federal judge on Dec. 4 certified a class of individuals who received unwanted text messages from a pizza chain franchisee, finding that a class will be superior to separate actions based on the small amount of damages and burdens of litigation (Brian Keim, et al. v. ADF MidAtlantic, LLC, et al., No. 12-80577, S.D. Fla., 2018 U.S. Dist. LEXIS 204548).

  • November 29, 2018

    Motion To Certify Collective Action Partly Granted In Wage Dispute With Franchise

    CHARLOTTE, N.C. — A North Carolina federal judge on Nov. 27 granted in part and denied in part a plaintiff’s motion to conditionally certify a collective action in her lawsuit alleging that an in-home companion care franchise had an unlawful policy and practice of failing to pay regular and overtime wages, finding that statewide notice to all employees of the franchisor is not appropriate particularly where other franchisees are not named as defendants (Roseann Geiger, et al. v. H.H. Franchising Systems, Inc., et al., No. 17-00738, W.D. N.C., 2018 U.S. Dist. LEXIS 199970).

  • November 26, 2018

    Judge Holds Arbitrability Under Franchise Agreement Must Be Heard By Arbitrator

    NEW HAVEN, Conn. — A Connecticut federal judge on Nov. 20 granted a sandwich shop franchisor’s petition to compel arbitration of a dispute with a franchisee, holding that the parties clearly agreed that questions of arbitrability would be decided by an arbitrator (Doctor’s Associates, Inc. v. Karlton F. Kirksey, No. 3:18-cv-963, D. Conn., 2018 U.S. Dist. LEXIS 197515).

  • November 26, 2018

    Franchisee Worker’s Age Bias Suit Reinstated By California Appellate Panel

    LOS ANGELES — A California Second District Court of Appeal panel on Nov. 20 reversed a summary judgment ruling for a McDonald’s franchisee in an age bias suit brought by a former employee, finding triable issues of material fact (Jeanine Denise Morgan v. JCAL, Inc., et al., No. B276474, Calif. App., 2nd Dist., 2018 Cal. App. Unpub. LEXIS 7821).

  • November 21, 2018

    Federal Judge Withholds Choice-Of-Law Ruling As To Franchise Act Counterclaims

    DALLAS — Although a Texas federal judge on Nov. 19 declined to reconsider her earlier decision refusing to dismiss a lawsuit seeking to invalidate uniform franchise agreements (UFAs), the judge withheld ruling on a choice-of-law issue as it applies to franchise act counterclaims “until the record is more developed” (Gigi’s Cupcakes LLC v. 4 Box LLC, et al. v. Keycorp LLC, et al., No. 17-3009, N.D. Texas, 2018 U.S. Dist. LEXIS 197264).

  • November 20, 2018

    In-Home Care Provider To Settle EEOC Harassment Case For $340,000

    SAN FRANCISCO — A California senior care provider franchisee, R. MacArthur Corp. (RMC), has agreed to pay $340,000 to five former employees to end a racial and sexual harassment lawsuit brought by the Equal Employment Opportunity Commission, according to a consent decree filed in the U.S. District Court for the Northern District of California on Nov. 19 (U.S. Equal Employment Opportunity Commission v. R. MacArthur Corp., et al., No. 17-4188, N.D. Calif.).