August 30, 2007
Wendys/Triarc Talks Advance
A possible purchase of Wendy’s by Triac Companies Inc., owner of Arby’s, appears to be moving forward (see earlier blog posting). According to this article, Wendy’s has now entered into a confidentiality agreement with Trian Fund Management, L.P. and Triarc Companies. Nelson Peltz, CEO of Trian and Chairman of Triarc, already owns 9.8% of Wendy’s stock. Wendy’s initially appeared reluctant to sell, but is now “closer to considering a sale, after slashing its earnings outlook for the year amid weak sales and high commodity costs.”
Breastfeeding Woman – Armed with the Law at Applebee’s
Apparently never leaving home without copies of Kentucky’s breastfeeding rights statute, and comparing herself to Rosa Parks, a woman has challenged Applebee’s treatment of her when she breastfed during lunch. According to this article, the woman claims that Applebee’s asked her to cover her baby with a blanket while breastfeeding at a booth in the restaurant. The restaurant manager claims that another customer had complained about indecent exposure, and the restaurant had merely asked the woman to “do it modestly.” The woman responded by handing the manager a copy of Kentucky’s breastfeeding law. Kentucky is one of thirty-nine states with a law giving women the right to breastfeed in all public and private places.
August 27, 2007
Quiznos Franchisee Association Woes Continue
In a continuing saga, Quiznos settled a lawsuit with Chris Bray, former president of the Toasted Subs Franchisee Association, Inc., and certain other franchisees for claims related to Quiznos’ quest to terminate his franchise agreements after Bray and other Quiznos franchisees allegedly posted negative information about the franchise on the web. Right after settlement, however, according to this article, the franchisee association filed a class action lawsuit against Quiznos “on behalf of an estimated 5,000 owners nationwide, ‘alleging that the franchisor has systematically defrauded its franchisees in a scheme designed to build the brand at the expense of its operators in the field.’” The lawsuit also alleges that Quiznos misrepresented “key facts” to prospective franchisees during the franchise sales process.
Dunkin’ Says “Obey All Laws”
According to this article, Dunkin’ Brands Inc. has taken its contractual mandate that franchisees “obey all laws” a step further. After terminating numerous franchise agreements for, among other things, franchisees’ employment of illegal immigrants, Dunkin’ has now filed suit in U.S. District Court in Boston against a group of Dunkin’ franchisees in Western Massachusetts, “accusing them of using the identities of former employees to hide the extent of overtime work done by their current employees.” It is too early to tell if other franchisors will adopt Dunkin’s aggressive approach to enforcing the “obey all laws” clause in their franchise agreements, which are common in franchising.
August 06, 2007
"Whatever Happened to HoJo's?"
For a bittersweet retrospective on Howard Johnson’s illustrious history (and its great ice cream sundaes) and its dwindling to only three locations today, check out this story.
Arby's Billionaire Owner to Make Offer for Wendy's...
Follow-up on July 17 posting....Billionaire investor and Arby’s owner Nelson Peltz already owns 9.8% of Wendy’s, the nation's third-largest hamburger chain, and holds three seats on Wendy’s board. With that influence, he has successfully pressured the competing chain to make significant strategic changes, including spinning off its Tim Hortons coffee-and-doughnut chain and selling its money-losing Baja Fresh Mexican Grill. Now he is, according to this article, offering $37 to $41 per share to buy the company outright. Peltz filed his offer letter to Wendy's Chairman James Pickett with the Securities and Exchange Commission earlier this week.
...While Wendy’s Cuts Off Ties With Debtor Franchisee
As these two pieces report, Wendy's has terminated its franchise agreement with the owner of 13 franchises that closed abruptly in western Massachusetts last week, as the state Attorney General announced that it is investigating the closures to determine if any wage or fair labor laws were broken. Wendy’s says it is working with the AG’s office to pay back wages to some 350 employees of the restaurants left in the lurch by the closures.
Jury Sides With El Pollo Loco-Mexico Against U.S. Counterpart in Trademark Action
According to this release issued by US-based El Pollo Loco, Inc., a quick-service restaurant chain specializing in flame-grilled chicken, a jury in Laredo, Texas has awarded damages of approximately $22 million to El Pollo Loco-Mexico in a suit alleging that the US entity failed to exploit certain Mexican trademarks issued to it by El Pollo Loco-Mexico and to develop new restaurants in Mexico. Further post-trial briefing is expected in early August.