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Alaska Franchisee Halcro Wins Final Victory over Avis!

Alaska's Aniakchak national preserve
A bald eagle soars over Alaska. Photo by Buzz Hoffman

ANCHORAGE – The U.S. Supreme Court has denied Avis Budget Group’s petition to hear its case, ending over ten years of litigation brought by the 94 year-old franchisee Robert Halcro. The spirited car rental owner/operator of Alaska Rent A Car had vowed all along to fight to the end.

In hearing the decision that he could now spend the $19.2 million payment for damages, Halcro said they were extremely pleased about the victory, but it wasn’t just a win for him. “This is a victory for all franchisees,” Halcro declared. “It’s not just a victory for Avis licensees, it’s a win for all brands; 7-Eleven, KFC, Subway and all the others.”

The Alaskan franchisee said the typical small operator probably could not fight a case like this one, anymore than he and his group could afford it. He said, “But we did. Franchisees need to have an organization that will fight for their rights. They have got to feel stronger about the way they can get justice. They should get the respect that they are entitled to,” he exclaimed.

When asked if he had the support of the other AvisBudget licensees and their associations, he said, “None.”

The long road to victory

The road to victory has not been an easy one for the Alaskan licensee and his company. Halcro signed his first Avis franchise agreement in 1956 in Valdez, Alaska. That was before Alaska became a state. Although he did not realize a profit for the first ten years, he signed a second agreement in 1965, which allowed him an exclusive license to use the Avis brand in various territories.

In 1973 he encountered his first legal feud with Avis, then under the Cendant Corp., when Avis opened a competing agency in his territory.  That prompted him to file a lawsuit to protect his rights, which concluded in a settlement in 1976.  Avis then executed an amendment to Halcro’s 1965 license agreement, allowing him specific locations in Alaska.

When Avis acquired Agency Rent A Car in 1995, licensees from ten states sued the rental company on grounds of violating their exclusive license agreements. After the consolidation of lawsuits and transfer of the case to New York in 1997, a settlement was reached and Halcro was invited to join the Agency Settlement Agreement. But after entering that settlement, Halcro's biggest legal battle erupted in November 2002, out of another Cendant purchase.

In 2002, Cendant acquired the assets of Budget Rent A Car, and in 2003 Halcro filed a federal lawsuit in Alaska alleging Avis’ acquisition and continued operation of Budget in competition with his company had violated all three of his license agreements. In his complaint, he asserted 12 causes of action including fraud, breach of various contracts, violation of Alaska Uniform Trade Secret Act, and anti-trust violations under federal and Alaska law.

The judge issued a decision, stating the Avis car rental group was unequivocally in breach of the agency settlement agreement. He ordered, “Alaska Rent-A-Car is entitled to whatever damages it actually incurred as a result of the breach of the Agency Settlement—no more, no less." 

In 2009 a jury awarded Alaska Rent A Car $16 million in damages plus attorney fees and costs. After Avis unsuccessfully appealed the decision, Halcro’s company received a total of $19.2 million. Two days later they were notified that Avis had petitioned the U.S. Supreme Court to hear the case. Halcro was ordered not to spend the money he had been awarded until the Supreme Court made its ruling. That decision came last November.

The real victory yet to be seen

Halcro said Avis has already told him they don’t want to fight him any longer. “I think they now see this 10-year legal battle with their franchisee in Alaska as foolish. Why wouldn’t they? Most of the rulings from the court were in our favor. Every time Avis went into court they were struck down,” he said. 

Halcro feels the real victory will be shown in the car rental giant’s actions going forward. Even now when he looks at the overall situation with Avis, Halcro thinks the company is doing some things right. “They are on a roll. Their stock is over 38 points, and that alone is phenomenal. I think they now want to be in a better light. I think they want to try to reverse the bad publicity they’ve received from my case,” he explained.

Halcro said Avis has had a way of isolating franchisees and putting heavy pressure on them to obtain what the franchisor wanted. He said that is what they did to him and his company through the litigation. “I hope that will stop,” he stated.

In closing, Halcro expressed that his legal battle with Avis affected everything in his life, including his family. “The one thing we got from this litigation is we now have the respect of the car rental industry.”  He spent millions of dollars on the litigation, but that was the most important thing to him.

Looking back at an earlier battle that helped win the war

Remembering an early interview . . . In 2008 when Halcro won one court battle, he said, “When we left the courthouse, it was snowing like hell. I told the others to go on without me. Even though I was seven blocks from my home, I called my wife and told her I was on my way, that I felt like walking in the middle of the street dancing. This was a great day; we won one.” Then he added, “But it’s not over until the rubber meets the road.”

On November 18, 2013 the rubber met the road in the David v Goliath lawsuit. The U.S. Supreme Court stated in its letter to the U.S. Court of Appeals for the Ninth Circuit: “The petition for a writ of certiorari is denied.”

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