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Mealey's Franchise

  • October 14, 2021

    Class Suit Accusing Subway Of Tuna Misrepresentation Dismissed With Leave To Amend

    OAKLAND, Calif. — A federal judge in California on Oct. 7 dismissed with leave to amend a putative class complaint accusing a sandwich franchisor of violating California’s unfair competition law (UCL) and other state laws by labeling its tuna salad, sandwiches and wraps as “100% tuna” while failing to prevent adulteration in its supply chain or honor its representation that it has “a global ban on the sale of tuna species that come from anything less than healthy stocks.”

  • October 12, 2021

    Golden Corral Franchisor Appeals Dismissal Of Coronavirus Coverage Dispute

    RALEIGH, N.C. — Golden Corral Corp. and Golden Corral Franchising Systems filed a notice in a North Carolina federal court on Oct. 6 indicating that they are appealing the court’s grant of an insurer’s motion for judgment on the pleadings and dismissal of their bad faith lawsuit seeking coverage for their financial losses arising from the suspension of their restaurant operations in response to the government orders prompted by the coronavirus pandemic.

  • October 04, 2021

    EEOC Sues Colorado Dealership For Subjecting Workers To Hostile Environment

    DENVER — A Golden, Colo., car dealership has violated federal law by subjecting both male and female employees to a sexually hostile work environment and Black and Hispanic employees to a racially hostile work environment, the Equal Employment Opportunity Commission alleges in a complaint filed Sept. 30 in a federal court in Colorado.

  • September 28, 2021

    Cleaning Company Franchisees Request Rehearing After Ruling For Franchisor On Fees

    NEW YORK — Two cleaning company franchisees moved for rehearing en banc on Sept. 24, less than a month after a divided Second Circuit U.S. Court of Appeals ruled that their franchisor’s compensation scheme, which included an initial franchise fee and ongoing payments from franchisees, did not violate Connecticut law even if the franchisees were found to be employees rather than independent contractors.

  • September 27, 2021

    Radisson, Competitor Stipulate To Dismissal Of Claim Of Interference With Agreements

    SPOKANE, Wash. — Following a stipulated motion to dismiss, a federal judge in Washington on Sept. 2 dismissed a lawsuit brought by Radisson Hotels International Inc., a hotel franchisor, alleging that one of its business competitors intentionally interfered with the franchise agreements of nine franchisees to acquire those franchisees and force the franchisor out of the subject territory.

  • September 27, 2021

    Federal Judge Dismisses Golden Corral Franchisor’s Coronavirus Coverage Dispute

    RALEIGH, N.C. — A federal judge in North Carolina on Sept. 8 granted an insurer’s motion for judgment on the pleadings and dismissed Golden Corral Corp. and Golden Corral Franchising Systems’ bad faith lawsuit seeking coverage for their financial losses arising from the suspension of their restaurant operations in response to the government orders prompted by the coronavirus pandemic, finding that the insureds have not plausibly alleged tangible, physical harm to their covered property or a tangible loss of their covered property.

  • September 27, 2021

    DOL Announces Final Rule Allowing Penalties Where Employers Take Tips

    WASHINGTON, D.C. — The U.S. Department of Labor announced a final rule on Sept. 23 that it says will restore the ability to levy civil money penalties up to $1,100 against employers who take workers’ tips and withdraw the civil money penalties’ provisions in the 2020 tip final rule that would have allowed the DOL to assess these penalties where such violations were found to be repeated or willful.

  • September 24, 2021

    Black McDonald’s Franchisees Argue Against Dismissal Of Bias, Fraud Claims

    CHICAGO — Two Black fast food franchisees who filed a second amended complaint alleging discrimination filed an opposition on Sept. 15 to the franchisor’s motions to dismiss and strike class allegations, arguing that they have addressed the issues raised in the previous dismissal by the federal judge in Illinois and added a claim for fraudulent concealment.

  • September 23, 2021

    9th Circuit Reinstates Grubhub Driver’s Wage Claims For ‘ABC’ Test Consideration

    SEATTLE — A district court must reconsider a food delivery driver’s wage claims under California’s “ABC” test, which distinguishes between employees and independent contractors in wage order cases as California’s Proposition 22 did not “abate” the application of the test to those claims, a Ninth Circuit U.S. Court of Appeals panel ruled Sept. 20.

  • September 23, 2021

    Pizza Franchisees:  Husband Is Not Employer, Emails Not Discoverable In Wage Suit

    DAYTON, Ohio — A pizza shop franchisee and her limited liability companies named as defendants in a putative class complaint by a pizza delivery driver alleging improper reimbursement for vehicle expenses filed an opposition on Sept. 21 to the driver’s motion to compel discovery responses, arguing that the franchisee’s husband who was also named as a defendant is not an employer and so his emails are not discoverable.

  • September 21, 2021

    7-Eleven Seeks Final Judgment In Its Favor After Franchisees Deemed Not Employees

    LOS ANGELES — A convenience store franchisor on Sept. 16 filed a proposed final judgment in a federal court in California in favor of itself one week after the judge issued findings of fact and conclusions of law determining that 7-Eleven franchisees are independent contractors and not employees.

  • September 20, 2021

    DOL Extends Effective Date For Rescission Of Joint Employer Status Rule

    WASHINGTON, D.C. — The U.S. Department of Labor (DOL) on Sept. 20 announced an extension of the effective date of the rescission a joint employer status rule that took effect under President Donald J. Trump’s administration in March 2020. 

  • September 15, 2021

    Human Resources Expert Qualified To Opine On Staffing Standards, Judge Says

    OXFORD, Miss. — A Mississippi federal judge on Sept. 13 rejected an employer’s attempt to narrowly define the expertise required in a wrongful death case, denying its motion to exclude filed in a case in which it is alleged that the company’s negligent hiring led to an employee’s death.

  • September 15, 2021

    8th Circuit: Arbitration Waived In Anti-Competitive Realty Commission Class Suit

    ST. LOUIS — One of the real estate broker franchisors accused in a putative class complaint of conspiring with other franchisors and the National Association of Realtors (NAR) to require home sellers to pay inflated broker commissions in violation of the Sherman Act waived its right to arbitrate after actively litigating the case for a year, the Eighth Circuit U.S. Court of Appeals ruled Sept. 10.

  • September 14, 2021

    EEOC Hits Subway Franchise With Bias Suit; Judge Discourages Dismissal Motion

    PHOENIX — The Equal Employment Opportunity Commission filed a disability bias complaint against a Subway franchise on Sept. 10, and a federal judge in Arizona the same day filed an order discouraging the parties from filing motions to dismiss or for judgment on the pleadings if any defects in the complaint could “be cured by a permissible amendment.”

  • September 13, 2021

    Split 2nd Circuit Upholds Ruling For Cleaning Franchisor On Collection Of Fees

    NEW YORK — A divided Second Circuit U.S. Court of Appeals panel on Sept. 9 ruled that a cleaning company franchisor’s compensation scheme, which included an initial franchise fee and ongoing payments from franchisees, did not violate Connecticut law even if the franchisees were found to be employees rather than independent contractors as the case law is clear that such fees are permitted and the franchisees received something of value, franchise rights, in exchange for the fees.

  • September 08, 2021

    Sonic Denied Summary Judgment Over Data Breach Negligence Class Claim

    CLEVELAND — An Ohio federal judge on Sept. 7 denied Sonic Corp.’s motion for summary judgment over a negligence claim brought against it by a class of financial institutions (FIs) related to the fast food chain’s 2017 data breach, with the judge finding that questions of material fact existed and holding that the key matter of proximate cause should be decided by a jury.

  • September 01, 2021

    Final Approval Granted To Franchisee’s Upper-Tier Minimum Wage Class Settlement

    LAS VEGAS — A federal judge in Nevada on Aug. 30 issued an order granting final approval of a more than $858,000 settlement to be paid by a Wendy’s franchisee in Nevada to settle class claims that it failed to pay workers who declined health benefits upper-tier minimum wages pursuant to state law.

  • August 30, 2021

    3rd Circuit Affirms Franchisor’s Motion Seeking To Halt Use Of Trademarks

    PHILADELPHIA — Two companies that purchased the right to franchise fitness studios failed to show that they are likely to succeed on claims that the fitness studio creator and her two companies breached their agreement or violated a noncompete clause when the creator failed to immediately begin operating her existing studios as franchises and instead began operating them under another name, the Third Circuit U.S. Court of Appeals held Aug. 10, affirming a district court’s denial of a motion for preliminary injunction.

  • August 30, 2021

    McDonald’s Franchise, Workers Reach Settlement In COVID-19 Nuisance Suit

    ALAMEDA, Calif. — A McDonald’s restaurant in Oakland, Calif., has agreed to improve its COVID-19 safety protocols in a settlement announced Aug. 5 to resolve a public nuisance lawsuit filed by its employees.