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Mealey's Franchise

  • 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.).

  • November 19, 2018

    Issue Of Fact Exists As To Whether Defendants Breached Terms Of Agreements

    NEWARK, N.J. — A New Jersey federal judge on Nov. 14 said that because an issue of fact exists as to whether the defendants breached the terms of a licensing agreement and the terms of a guaranty entered into with a hotel operator, summary judgment is not warranted in favor of either of the parties (Days Inn Worldwide Inc. v. B.K.Y.K-II Inc. et al., No. 16-452, D. N.J., 2018 U.S. Dist. LEXIS 194899).

  • November 19, 2018

    Judge: Faxes From Hotel Safe Sales And Lease Company Were Not Unsolicited

    ORLANDO, Fla. — A federal judge on Nov. 15 awarded summary judgment to a hotel safe sales and leasing company, finding that the company did not violate the Telephone Consumer Protection Act of 1991 as modified by the Junk Fax Prevention Act of 2005 (TCPA) by sending three faxes to two hotels because the defendant company was an approved supplier by the plaintiff companies’ franchisor (Gorss Motels Inc., et al. v. Safemark Systems LP, No. 16-cv-1638, M.D. Fla., 2018 U.S. Dist. LEXIS 194892).

  • November 15, 2018

    Denial Of Attorney Fees For Defendants Recommended In TCPA Class Suit

    FORT LAUDERDALE, Fla. — A Florida federal magistrate judge on Nov. 8 issued a report and recommendation to deny a motion for attorney fees filed by a fitness franchisor and a franchisee who were defendants in a class complaint filed under the Telephone Consumer Protection Act (TCPA) (Bilal Saleh, et al. v. Crunch, LLC, et al., No. 17-62416, S.D. Fla., 2018 U.S. Dist. LEXIS 192251).

  • November 14, 2018

    Judge: Contract Suit Over Agreement To Open Coffee Shops Subject To Arbitration

    DETROIT — A Michigan federal senior judge on Nov. 9 dismissed a $12 million lawsuit brought against a coffee house franchisor, finding that the claims against it are subject to a business agreement’s arbitration clause (Roasting Plant of Michigan JV, LLC, et al. v. Roasting Plant, Inc., et al., No. 18-10295, E.D. Mich., 2018 U.S. Dist. LEXIS 192558).

  • November 13, 2018

    Magistrate Holds Dispute Over Franchise Agreement’s Validity Must Be Arbitrated

    DETROIT — Since a franchisee failed to challenge the validity of an arbitral agreement, a Michigan federal magistrate judge on Nov. 8 held that the court could not review the validity of an underlying franchise agreement in the first instance and that the issue must first be reviewed by an arbitrator (DetailXPerts Franchise Systems, LLC v. TKTM Enterprise, LLC, et al., No. 18-11823, E.D. Mich., 2018 U.S. Dist. LEXIS 191992).

  • November 13, 2018

    Florida Federal Judge Tosses Class Suit Over McDonald’s Cheese Charges

    FORT LAUDERDALE, Fla. — A Florida federal judge on Nov. 2 ruled that a putative class complaint, which alleged that some franchised locations of McDonald’s overcharge customers who choose to have certain hamburgers without cheese, failed to state any viable claims and that any “additional amendments would be futile” (Cynthia E. Kissner, et al. v. McDonald’s Corporation, No. 18-61026, S.D. Fla., 2018 U.S. Dist. LEXIS 192585).

  • November 12, 2018

    2nd Circuit Affirms Dismissal Of Franchisee’s Suit Against Ameriprise Financial

    NEW YORK — The Second Circuit U.S. Court of Appeals on Oct. 30 affirmed a lower federal court’s dismissal of an ex-franchisee of a financial service company’s lawsuit against the company and a New York district attorney, finding that the breach of contract and prosecutorial misconduct claims are barred (Jennifer S. Wilkov v. Ameriprise Financial Services, Inc., et al., No. 17-1388, 2nd Cir., 2018 U.S. App. LEXIS 31010).

  • November 8, 2018

    11th Circuit: Earlier Settlement Offer Is Relevant In FLSA Fee Award

    ATLANTA — The trial court properly awarded attorney fees that were less than what was requested following the settlement of former delivery drivers’ Fair Labor Standards Act (FLSA) minimum wage claims because, in calculating reasonable attorney fees, the trial court was permitted to consider the drivers’ rejection of earlier settlement offers and to consider the final results achieved compared to the recovery originally sought and to the requested fee award, the 11th Circuit U.S. Court of Appeals ruled Nov. 2 (Douglas Walker, et al. v. Iron Sushi LLC, et al., No. 18-10617, 11th Cir., 2018 U.S. App. LEXIS 31062).

  • November 7, 2018

    Motel 6 Agrees To Pay Up To $7.6M To Settle Guest List Class Suit

    PHOENIX — The parties in a class lawsuit over guest lists being voluntarily turned over to U.S. Immigration and Customs Enforcement (ICE) agents by Motel 6 Operating L.P. and G6 Hospitality LLC, doing business as Motel 6, filed a joint motion on Nov. 2 for preliminary approval of a settlement that will provide class members with up to $7.6 million (Jane V., et al. v. Motel 6 Operating L.P., et al., No. 18-242, D. Ariz.).

  • November 2, 2018

    North Carolina Judge Rejects Claims Georgia Franchisee Filed Against 2nd Franchisee

    WILKESBORO, N.C. — A North Carolina judge on Oct. 22 dismissed with prejudice a Georgia franchisee’s claims against another franchisee for conversion, tortious interference with contract and unfair and deceptive trade practices under North Carolina General Statutes Section 75-1.1 (Window World of North Atlanta, Inc., et al. v. Window World, Inc., et al., No.18 CVS 70, N.C. Super., 2018 NCBC LEXIS 111).

  • November 1, 2018

    Federal Judge: No Preliminary Injunction For Gas Station Franchisee

    BOSTON — A Massachusetts federal judge on Oct. 22 ruled that because a gas station franchisee had not “abandoned any aspect of its franchise,” it could not prove constructive termination of a franchise agreement necessary for granting its motion for a preliminary injunction to enjoin the franchisor from increasing the rent or terminating a lease and franchise under the Petroleum Marketing Practices Act (PMPA) (Hopkinton Friendly Service, Inc. v. Global Companies LLC and Global Montello Group, No. 18-11977-NMG, D. Mass., 2018 U.S. Dist. LEXIS 180418).

  • November 1, 2018

    Wisconsin Federal Judge Denies Relief In Restaurant Trade Dress Row

    MADISON, Wis. — In an Oct. 31 decision, a Wisconsin federal judge found that a franchisor is unable to demonstrate a “better than negligible” likelihood it will succeed on allegations a former franchisee infringed its trade dress in establishing a new restaurant at the same location (E&G Franchise Systems Inc. v. Aubrey Janik, et al., No. 18-416, W.D. Wis., 2018 U.S. Dist. LEXIS 186245).