Mealey's Franchise
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March 26, 2021
McDonald’s Granted Judgment In Cybersquatting Suit Over Use Of ‘McD’ Domains
SEATTLE — A man who registered several internet domains incorporating McDonald’s Corp.'s valid “McD” trademark, did so with a bad faith intend to profit by seeking to obtain payment from the fast food chain in exchange for his delivery of misdirected emails, a Washington federal judge ruled on March 23, granting summary judgment to McDonald’s on its cybersquatting counterclaim against the man.
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March 25, 2021
6th Circuit Told Fairness Act Applies To Foreign Dealers And Arbitrability
CINCINNATI — A Kuwaiti car dealer in a March 22 appellant brief urges the Sixth Circuit U.S. Court of Appeals to find that the Motor Vehicle Franchise Contract Arbitration Fairness Act (the Fairness Act) applies to foreign dealers and that a district court reversibly erred by ordering it to arbitrate breach of contract claims against Ford Motor Co. rather than first evaluating the claims’ arbitrability.
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March 22, 2021
McDonald’s, Franchisees Permitted To Intervene In Joint Employment Appeal
WASHINGTON, D.C. — The District of Columbia Circuit U.S. Court of Appeals on March 19 granted motions for leave to intervene filed by the franchisor and franchisees in an appeal by two unions seeking review of the National Labor Relations Board’s orders in a joint employment dispute.
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March 22, 2021
U.S. High Court Won’t Hear Franchisees’ Arbitration Delegation Appeal
WASHINGTON, D.C. — The U.S. Supreme Court on March 22 denied a petition for a writ of certiorari filed by two commercial cleaning business franchisees seeking resolution of a circuit split and a decision on whether a passing reference to a set of arbitration rules constitutes “clear and unmistakable” intent to delegate arbitrability issues to an arbitrator, rather than a court.
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March 22, 2021
New York Justice: Motion To Vacate Injury Case Summary Judgment Lacks Merit
BRONX, N.Y. — A New York state court justice on Feb. 26 denied a motion to vacate a summary judgment upon default in favor of Dunkin' Donuts Franchising LLC, ruling that the action in a case alleging personal injuries from a fall in a driveway used by several businesses lacked merit against Dunkin'.
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March 19, 2021
Federal Judge Dismisses Franchise Owners’ $41M Coronavirus Coverage Suit
NEWARK, N.J. — A federal judge in New Jersey on March 17 granted an insurer’s motion to dismiss a breach of contract lawsuit brought by the owners of more than 120 franchise locations under the brands Wendy's, T.G.I. Friday's, Marriott and Hilton, finding that the insureds’ “general statements that the COVID-19 virus was on surfaces and in the air at their properties is insufficient to show property loss or damage.”
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March 18, 2021
New Jersey Federal Judge Enters Default Judgment Against Franchisee In Breach Case
NEWARK, N.J. — A New Jersey federal judge on March 10 granted a motion for default judgment against a franchisee and its two individual members that did not respond to a lodging franchisor’s lawsuit, ordering them to pay $151,846.25 on claims that they breached their franchise agreement and the members’ guaranty by selling a hotel to a third party without prior consent and failing to pay liquidated damages and recurring fees.
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March 18, 2021
McDonald’s Seeks To Strike Class, Dismiss Race Bias Claims By Franchisees
CHICAGO — A fast food franchisor filed replies on March 8 in a federal court in Illinois supporting its motions to dismiss a racial discrimination action and to strike proposed class claims brought by two Black franchisees, arguing that the plaintiffs have failed to show intentional discrimination or that there was a nationwide conspiracy.
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March 18, 2021
Federal Judge: Arby’s Failure To Provide Braille Gift Cards Not An ADA Violation
NEW YORK — A New York federal judge on March 8 dismissed with prejudice a blind man’s proposed class action alleging that the Arby’s fast food franchisor violated the Americans with Disabilities Act (ADA), as well as state and local laws, for failing to provide gift cards in Braille.
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March 18, 2021
Class Claims Over 2020 Marriott Data Breach Dismissed With Prejudice
GREENBELT, Md. — Two customers of Marriott International Inc. failed to allege facts establishing that injuries they experienced were fairly traceable to the hotel chain’s 2020 data breach, a Maryland federal judge ruled March 3, granting Marriott’s motion to dismiss their negligence and unfair competition claims for lack of standing.
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March 17, 2021
Domino’s Argues For Stay Pending Appeal Of Arbitration Denial In Putative Class Suit
SANTA ANA, Calif. — A pizza company argues in a March 15 brief that a case involving a putative class complaint over truck drivers’ cell phone expenses should be stayed pending appeal of the denial of its motion to compel arbitration because the appeal raises a “substantial issue . . . of first impression.”
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March 17, 2021
Federal Judge Excludes Former Employee’s Expert Report In Suit Over No-Poach Clause
EAST ST. LOUIS, Ill. — On Feb. 24, the parties in a proposed class action over a sandwich chain franchisor’s contractual no-poach agreement filed a redacted version of an Illinois federal judge’s sealed decision to exclude a former employee’s expert report as methodologically flawed and admit two expert reports for the franchisor.
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March 17, 2021
Title III ADA Claim Moot After Plaintiff’s Death, New York Federal Judge Rules
BROOKLYN, N.Y. — Following the death of the plaintiff in a putative class action disability access suit that was filed shortly before his death, a New York federal judge on March 9 rejected requests to stay the case so that an estate representative could be substituted in or a new plaintiff found to appear as class representative, dismissing an alleged violation of Title III of the Americans with Disabilities Act (ADA) claim as moot and noting that “successful class certification motions in this Circuit in cases like this are few and far between.”
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March 16, 2021
Federal Judge Allows Sex Trafficking Coverage Suit To Proceed But Stays Discovery
ATLANTA — A federal judge in Georgia on March 15 refused to dismiss an insurer’s lawsuit seeking to rescind a liability insurance policy and a declaration that it has no duty to defend or indemnity the owner, operator and franchisors of a Marietta, Ga., hotel against underlying sex trafficking claims but stayed discovery to see how prosecution of the underlying action proceeds.
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March 16, 2021
EEOC Sues IHOP Franchisee For Manager’s Alleged Harassment Of Workers
BALTIMORE — The Equal Employment Opportunity Commission filed a complaint on March 15 in a Maryland federal court accusing the owners of 12 IHOP franchises of subjecting female employees, including teenagers, to sexual harassment by the general manager of its Frederick, Md., location.
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March 12, 2021
Federal Judge: Childcare Franchise May Be Liable In Wrongful Death Suit
GALVESTON, Texas — A Texas federal judge on March 10 denied a motion for summary judgment in a wrongful death suit, finding that “a broad contractual right to control operative details” exposed a childcare center franchisor to vicarious liability for a franchisee’s alleged negligence.
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March 11, 2021
Policy Requires Final Judgment Or Settlement Before Suit, Panel Affirms
ATLANTA — The 11th Circuit U.S. Court of Appeals on March 9 affirmed a lower court’s dismissal of an equipment rental company insured’s bad faith failure-to-settle lawsuit against its insurer, noting that the Georgia Supreme Court has interpreted nearly identical policy language as requiring a final underlying judgment or settlement before a party can bring a coverage suit.
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March 11, 2021
Franchisor Awarded Fees, Damages, As Sanction In Trademark Dispute
MEMPHIS, Tenn. — A federal judge in Tennessee on March 10 found that the disgorged profits framework established in the Lanham Act can serve as the basis for an award of damages as a sanction for violation of an injunction, even without a first finding of liability under the statute.
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March 11, 2021
Federal Judge Certifies In Part Wage And Hour Class Claims By Tool Maker Franchisee
SAN FRANCISCO — A California judge on Feb. 21 granted in part and denied in part a motion for class certification brought by a franchisee and distributor for a professional-grade mechanics tools manufacturer on wage and hour claims. The judge certified claims for employment misclassification and reimbursement and declined to certify claims regarding overtime, meal and rest breaks and wage deduction claims.
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March 11, 2021
Pizza Delivery Drivers’ Class, Collective Wage Suit Settles For $3 Million
NEW BERN, N.C. — A North Carolina federal judge on March 3 granted a motion for final approval of a $3 million settlement fund plus attorney fees in a class and collective action suit by delivery drivers who allege that a Domino’s Pizza franchisee violated federal and state wage laws by not sufficiently reimbursing them for expenses.
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March 10, 2021
Wisconsin Panel: No Employee Benefits Liability Coverage Owed For Franchise Owner
MILWAUKEE — A Wisconsin appeals panel on March 9 held that a commercial insurer does not owe employee benefits liability coverage for six underlying class action lawsuits brougt against its restaurant franchise operations owner insured, affirming a lower court’s grant of summary judgment in favor of the insurer.
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March 09, 2021
Restaurant Chain Claims ‘Knock-Off’ Violated UCL, U.S. Trademark Law
SANTA ANA, Calif. — Boiling Crab Franchise Co. LLC sued Cajun Boiling Crab Inc. and related parties in a California federal court on March 4, alleging that its “knock-off” restaurants deliberately infringe federally registered trademarks and constitute violations of federal and California unfair competition laws.
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March 09, 2021
6th Circuit Sets Oral Arguments In Countertop Franchise Dispute Over Forum Selection
CINCINNATI — Following the filing of briefs in a dispute between the seller and manufacturer of a line of countertops over whether the Michigan Franchise Investment Law (MFIL) prohibits the enforcement of forum-selection clauses, the Sixth Circuit U.S. Court of Appeals on Feb. 25 scheduled oral arguments for April 20.
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March 04, 2021
Federal Judge Grants Franchisor Partial Dismissal In Dispute Over Territory
HARTFORD, Conn. — A Connecticut federal judge granted an urgent care facility franchisor partial judgment on the pleadings on Feb. 24 in a dispute over the purchase of certain franchises in the plaintiff’s territory, dismissing claims alleging violation of antitrust law and state franchise and business law and claims including tortious interference and abuse of process.
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March 02, 2021
Franchise Groups To Amend Complaint Over California Independent Contractor Test
SAN DIEGO — Four franchising-related associations on Feb. 16 gave notice in a federal suit challenging the constitutionality of California’s “ABC Test” that they intend to file a first amended complaint in time to render the state’s pending motion to dismiss the original complaint moot, saying that the court should deny the motion to dismiss on those grounds. The state argues, among other things, that the ABC Test does not interfere with any congressional objective in the Federal Trade Commission’s Franchise Rule or the Lanham Act.