![Quicken Home & Business 2009](http://www.bluemaumau.org/ads/www/delivery/ck.php?oaparams=2__bannerid=49__zoneid=5__cb=256a26612d__maxdest=http://quicken.intuit.com/small-business-finance/home-business.jhtml?priorityCode=3969702399&kbid=8136&img=quickenaugbanners/9241-r1_q_hb_06_ws.jpg⊂=" "Quicken Home & Business 2009")
Judge Dismisses Federal Claims against Quiznos without Prejudice
CHICAGO (Blue MauMau) - In a decision filed yesterday, Judge Rebecca R. Pallmeyer, U.S. District Court, Northern District of Illinois, stated that Quiznos' motion to dismiss is granted. But she adds that the plaintiffs' federal claims on counts I, II, III, IV and VII, are dismissed without prejudice, meaning that the lawsuit has been brought to a temporary end although no legal rights or privileges have been determined. The Quiznos franchisees were given leave to amend their complaint within thirty days. Judge Pallmeyer states that unless or until the franchisees file the amendment, the court suggests that the pending state law claims be addressed by the state court.
The lawsuit was filed as a class action by six Illinois franchisees on April 19, 2007, against Quiznos and its related entities. But it also named two corporate officers and six of the company's Illinois employees. The group claimed they have all suffered losses in connection with the franchise agreements they signed with Quiznos, and alleged ten claims of action. They asserted violations of Racketeer Influenced and Corrupt Organizations Act (RICO), the Sherman Act, the Illinois Antitrust Act, the Illinois Franchise Disclosure Act of 1987, and the Illinois Consumer Fraud and Deceptive Business Practices Act. Their claims also included that of common law fraud, breach of contract and breach of covenant of good faith and fair dealing.
Quiznos moved to dismiss all their claims on June 8, 2007.
Judge Pallmeyer went through each of the ten claims asserted by the franchisees, in explaining her decision. She also showed the comparisons between the Illinois action and the Wisconsin litigation, stating they were almost identical. She states that Quiznos is correct that, in light of
the explicit and comprehensive disclosures in the UFOC and Franchise Agreement, plaintiff franchisees cannot sustain any claim predicated on the contractual terms in question and dismisses Counts I and II (RICO), III (Sherman Act), IV (Illinois Antitrust Act), and VII (common law fraud). She states, "This includes all of Plaintiffs’ federal claims. In general, when all federal claims have been dismissed prior to trial, the trial court should leave the pendent claims to the state courts."
Quiznos Pleased with Decision; Plans More Energy Toward Franchisee Profitability
Richard Emmett, Quiznos' Executive VP and Chief Counsel, said they are obviously very pleased with the decision. "It's what we expected. It is totally consistent not only with what we thought but with what Judge Griesbach ruled in Wisconsin." He added that this is the third case that has been dismissed, one which was voluntarily dismissed by the plaintiff's themselves without the court even taking into account any discovery. Emmett said, "Now multiple courts have determined that a cause of action just wasn't stated. So we are pleased with the result, but we are even more pleased to hopefully have this behind us." Emmett said they can now spend more time and energy toward increasing franchisee profitability. He concludes, "That has been our goal all of last year, all of this year and into the future. That's what we want to concentrate on."
Franchisees Will Vigorously Pursue State Claims
But in view of this latest decision, Justin Klein, Marks & Klein, attorney for the six Illinois franchisees, said they were evaluating their options with respect to the federal claims the judge dismissed. "It is critical to understand that the court dismissed them "without prejudice" and has ordered the plaintiffs to file an amended complaint by April 21," Klein said. And he continued, "As we did in Wisconsin, we will take the judge’s advice and vigorously pursue our state claims, including those alleging violations of Illinois' Franchise Disclosure Act and its Consumer Fraud and Deceptive Business Practices Act."
Judge Daniel's recent decision in Colorado stated that Colorado's consumer fraud statute applied to their franchisees there, and Klein said they see no meaningful distinction between the Colorado Consumer Protection Act and what is set out by the Illinois Legislature. He explained, "Indeed, Judge Pallmeyer states in her decision that these claims are "not obviously flawed" and instructed us to proceed with them along with our other state law claims. As I have stated in the past, our legal team will continue to fight for the Quiznos franchisees until they receive justice--wherever that fight has to be fought and on whatever terms. Real injuries occurred here to real people and the law is on our side."
--
Related readings:
- Judge Daniels (Colorado) Decision Cannot Be Dismissed
- Quiznos Operators File Class Action in Wisconsin
- Quiznos Franchisee Association Will Appeal Wisconsin
| Attachment | Size |
|---|---|
| Judge Pallmeyer Decision.PDF | 66.18 KB |
Girls were Girls and Men were Men?
WOW, Did I say that!
Now days you need a law degree to run a business. Napkin agreements ARE a thing of the past. (Of course to be acurate, a bar napkin with two signatures could be conscrued as a legal binding contract.)People trusted each other because honor and ethics meant something. If you were a snake oil salesmen, word of mouth would get out and they would be put to shame.
Word was getting out about Quiznos and the repercussion was a defamation lawsuit brought on by the zor to silence those speaking out. Yes, because it was part of their contract about defamation. Problem is, what is defamation, and what is truth?
All these so called 'clauses' in contracts are ways to protect only one party of the contract. Even in construction, most general contractors used the standard AIA contract forms. But now I am finding more using their own forms with 'hold harmless' clauses. I cannot believe these would hold up in court.
I also read that most attorneys would advise their clients put 'hold harmless' and alike clauses in their contracts. But then they tell other clients NOT to sign these one sided contracts because it strips them of their rights? Mind boggling????
So yes, for the most part, the bar napkin negotiation days are gone!
BTW, the Federal Judge in the Wisconsin case just granted motion to amend!
Re: Girls were Girls and Men were Men?
Guest says - " So yes, for the most part, the bar napkin negotiation days are gone!"
I say - Thank God! You'd have to be an idiot to think that an agreement sketched out on any kind of napkin bar or otherwise is a good idea.
In fact these most revered and holy bar napkins you speak so fondly of were the gensis of modern day franchise disclosure laws developed in the 1970s.
The Truth Shall Set You Free!
TIF
Bar Napkin Deals
Boy, am I dating myself! And making myself to be a simpleton.
Yes in some ways, thank god they are gone. I just miss the old days where you had trust in people because you could. (in most instances)
TIF,
I do agree with some of your postings, that not all franchise chains are bad. I am just one person who got bit by an evil one that has left a sour taste in my mouth.
Quiznos Franchisee
Re: Bar Napkin Deals
Fair enough! But I gotta tell ya that dishonesty in business is not a recent innovation there have been swindlers, cheaters and snake oil salesman for time in memoriam.
Heck I don't know how old you are but I have never met an actual snake oil salesman. Have you?
The Truth Shall Set You Free!
TIF
P.S. Charles Ponzi died in 1949.
Since when did they stop teaching good morals in school?
When did they stop teaching good morals in school?
Business Ethics 101 should be taught to everyone!
I know the days of contracting and agreements on a bar napkin are over, but back in the day fraud was fraud.I believe what Carman and DD have been trying to say all along is Quiznos has violated good business ethics that 95% of businesses in America follow. Now we all know (and some of us all too well) that quiznos utilizes unethical business practices. And I believe it is a shame that the courts do not see a rat for what it is and judge based on that.
But whether or not the issues are illegal in the courts eyes, it seems we can all agree that Quiznos was not an ethical company built on high moral standards.
These posts have been fun and educational to read, but please don't confuse ethics with legal issues. Some days we all wish they could go hand in hand, but they do not.
A Quizno's Franchisee
ethics and legal issues
Too often people lump the two together. Although they are not necessarily disparate concepts, as you stated, they do not always go hand in hand. While Quiznos may be exercising poor business decisions, this is not to say that your grievences have legal merit. Once you cross the line to adjudicating based upon empathy for one's dire situation, everything falls apart, because that is a purely subjective foundation for solving problems. I can make my issues seem worse than yours. I can rant and rave about how the world has done me wrong. Or, I can dust myself off, resolve myself to do better next time, learn from what I did wrong, and move forward.
Yes in most businesses
there are rules to follow. The sales person is responsible for their disclosers.
I believe our society is going down hill as we become more of a franchise, (own your own business?) world. Ethics does not go hand and hand with business anymore. I always believed you cannot seperate the two.
Yet as I get older I hear more people seperating the two. Like one friend of mine quoted to me, "That is ethics not business." I still strongly believe you can't seperate the two.
Is franchising the only business that has permission because of the language of the UFOC that zors put there so the meaning can be interperated different ways. Like projected new stores to open in the next year. A reader could think, "Wow this company is going somewhere." Another reader could think, "Hmm projected, where did they get those numbers? Do they have a formula that they get those numbers?" Or another reader will think, "There is no way to project future success. This is full of crap."
I believe by using words that could be interpertated in so many ways this is another way they reel you in. I believe everyone read a UFOC/FDD with discerning eyes because then you can spot the misleading statements. Plus you will spot the obvious nature of the UFOC. ( To protect the zor and only the zor and no one else.)
you know who you were then. Girls were girls and men were men
It was written:
I know the days of contracting and agreements on a bar napkin are over,
My reply:
Depends on the man. They are not over for all. In the old days people understood that the court of justice might not necessarily occur in a court room proper. That reality acted as a common sense brake on many would be con man. Today in this feminized society people feel free to be dishonorable because seldom is justice administered, just penalty of law.
FuwaFuwaUsagi
"Never underestimate the power of stupid people in large numbers."
I totally agree with you Fuwa
It use to be that girls were girls and men were men.
I see more men that think of a spouse as a second income and not the woman that will be a mother to their children and provide a happy, orderly, clean and safe place for their man to come home to..
Providing a home life for your family is a full time job. Maybe I am old fashion in my thinking but isn't being a good wife and mother more important?
Although I do see some men who are men. Those men I respect to the fullest.
Now I see more women wanting to take their place in the coporate world. Who take pride in how much money they can make. Leaving maids to clean their home, nannys to raise their children.
That has always been my dream in life to be a mother to my children.
Maybe many boys who are raised with a successful business women get that message that woman is suppose to bring home the bacon, fry in a pan and be a mother too. When they become men they convert it to their reality.
I agree Fuwa men should be men and girls should be girls.
I believe training a man to be a man begins in childhood. And vice versa. Maybe parents need to ingrain this in their children's heads. More business classes should be taught in schools so when that boy becomes a man he will know how to deal with the business world. I believe education is important for a girl. As a back up plan in case something happens they will have a good job to support their family. Yet the mother can teach their son to be a man. By not babying them when they reach their teens. Treat them like men and they will be men. (Not their baby boy anymore.)
As far as a feminized society we are not taught by our parents or in our school system to be any different. Many learn it by the school of hard knocks and higher education.
As far as legal knowlege. Many people do not understand the law. Perhaps that should be taught in our schools also.
Maybe that is why people get in trouble in the world of franchising.
Actually, Don, what you remember is incorrect
Girls were never girls, and men have not improved with the passing years.
The male led societies have brought us to wars and economic disasters, while the "girls" were ooften left abandonned to be the only support for the kids.
Men, just to give a recent example, decided to burn food to try to get the price of gas down. Genius, what?
We were taught many false notions by inadequate leadership seeking to avoid being called to account. Were women really condemned to suffering because Eve introduced Adam to fresh fruit?
Their revenge is now that they will become newly established franchisors and rip off men by the thousands - to get even?
--
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Feminized society
The lack of personal responsibility is just pervasive throughout America now. It used to be you could likely only expect that from silver-spoon yuppies, but now it seems like everyone is expecting a handout. Yes, the news is blaring that the economy is about to be in a recession, yes, the news is blaring that multiple industries are about to take a hit. Blah, blah, blah. The ball does not always bounce your way. If you have not anticipated that there was a possibility to lose your investment, you did not actually do any due diligence and you were inadequately prepared. Businesses fail. I know of a Brazilian eats that opened up not too long ago, and now it is gone. Personally, I love Brazilian barbeque, but some things just don't work out. In the end, whining about it does not help, be you female or not.
Do you think
ethics, business and legal issues are seperate entities?
Just the facts as I know and experienced them
Below are the facts, not my feelings, on this case and my personal experiences with Quiznos. incidentally, I owned, operated and partnered in numerous Quiznos stores in several states, so I know that of which I speak:
That is not to say that I have not also lost a lot of money in several other ventures. In every case what was important was who I became, not what I made. Who I am today is in part due to the lessons, friendships, and experiences I obtained while with Quiznos. What Quiznos taught me is how to make things work for you no matter what the obstacles. Those waiting on the court to redress their losses may be waiting a very long time.
Government Regulation is a Forum Discussion
This comment has been moved here.
Sorry to break up the party but postings related to the issue of government regulation are not appropriate here. Comments under a news story should be about the news story -- the merits of the Northern Illinois District Court's ruling on Quiznos.
There's a lot of meat in the attachment and in the story to discuss.
The community already has a long-standing forum on government regulation. Forums are meant for discussion and debates on long-standing topics. Some of our posters already know that but choose to ignore protocol and so the whole thread on UFOC and government regulation has now been moved.
Sorry.
Mr. Blue MauMau
Community Umpire
Quiznos thrown out of federal court ---No surprise!
This is really no surprise because Quiznos knows that the status quo of the law and their contract protects them from not disclosing past and present performance statistics, i.e., the failure or success of franchisees on a unit basis, and that they are always home free in the federal courts. Apparently, franchisors are not required to disclose these statistics as material to the contract under federal and state law.
The 40% more or less of Quiznos franchisees who fail are generally silenced in failure and loss of financial resources, and Quiznos gets their assets one way or the other to continue in the service of Quiznos. The small percentage who make it to court are represented by attorneys who have to try to get around the binding, malicicious, and self-serving contract that their clients signed because they didn't really understand the implications of the contract---and they thought, anyway, that the unbargained contract was not negotiable because of the UFOC.
Apparently, the law of the contract is more important than justice and those who are smarter can use the law to cheat and steal with immunity. The judges protect their innocence on the premise that the letter of the law in contract law must be respected to protect the financial markets.
This, of course, is true but it is also true that the franchisees are tricked into signing these contracts by appearances.
Klein had uphill fight on law
Judge Pallmeyer essentially dismissed the federal claims because she found that the franchise purchasers should have read their paperwork before signing the contract. Federal judges do tend to be strict in booting matters to state court if they can, which is what she did here.
As a practical matter, state courts are more amenable to the type of claims being raised here, but will still be a tough fight in state court. However, the fact remains that zees need to start paying attention to the written agreement and not to the sweet talk of the franchise salesperson.
As to the person who posted about hopes for a big jury verdict: remember that getting in front of a jury is a lot easier said than done.
Mr. Emmett's prior swipes at Mr. Klein are misplaced: Justin Klein's track record is a reflection of how difficult it is to win a case on the equities when the law is not in your favor. Klein has done as good a job as anyone can, and state law claims are a better shot than federal--Emmett shouldn't be counting his chickens quite yet.
Paul Steinberg
Franchisee Attorney, New York City, Ph: 212-529-5400
Rebecca Pallmeyer Quizno's decision
Given the focus on vendor kickbacks and supra-competitive pricing, I am struck by the line from Quiznos offering circular:
The Judge quotes this at page 4, but then at page 12 the Judge makes a stunning decision:
The Judge finds it of some importance that (p. 11):
The Judge agrees with the Wisconsin judge that the franchisees might have a claim for breach of contract, but from the tenor of her ruling one suspects that she would not have much sympathy for such a claim were she to be sitting on the state court bench.
The 7th Circuit also plays a role. As we all know, that court is famed for Judge Posner's "Chicago School" jurisprudence. Now, I think that the definition of relevant market as being the "QSR toasted sandwich franchises" is a bit of a stretch. But the finding that the market is all franchise systems (p. 16) is the opposite extreme.
Another interesting distinction is found at footnote 2. Now I happen to disagree with the reasoning such as found in fn2, but as I keep saying ad nauseum on this board:
courts find franchise purchasers to be sophisticated businesspersons, not "vulnerable consumers or helpless workers."
Particularly in light of the IFAs own marketing efforts in recent years, I suspect this distinction will become increasingly difficult to sustain: franchising is in part a method of purchasing labor, a substitute for direct hiring of workers. Indeed, the zor can exercise more control over a franchisee than an employee, and in our article we had cited cases both in the US and abroad discussing this reality.
But before zee-side advocates jump for joy, I would point out that were it to come before the 7th Circuit today, the great body of labor/wage& hour legislation taken for granted by most of us would likely be given a rather hostile reception. Times have changed, and if we look for example at the enforceability of ADR clauses in cases involving vindication of federal law claims by employees we can see that much of the federal judiciary is amenable to the idea that folks should fend for themselves.
Carefully reading Judge Pallmeyer's decision, we see her belief that the Quizno's franchisees should have expected to be gouged by their franchisor.
It is about as close as one will find a federal judge coming to state that people who buy a franchise deserve what they get. (Before anyone gives me the 'breach of contract' lecture, see my comment above; and let's see how far Klein gets with this in state court).
Whether you agree with Pallmeyer or not, her decision is well within the current mainstream case law. Anyone contemplating a franchise purchase should read it carefully.
(But then again, on BMM we have zees complaining that they are not given enough information at the same time the zees complain that the UFOC is too long and too hard to read. No wonder Webster is getting cranky recently.)
Paul Steinberg
Franchisee Attorney, New York City, Ph: 212-529-5400
Hard but Fair Testimony
This posting has an authentic ring accuracy.
The law and Courts do NOT reflect what a layperson's opinion of fairness or good faith. They never have. They never will.
Legislation is too coarse a filter to differentiate based on morality or ethics.
Looking to the law is not hope; it is false hope.
Les Stewart MBA
Understanding Franchising
The Nature of Business
Thank you for pointing out something a lot of people in business or who are self employed tend to forget...that with every decision and action there is an equal or more powerful reaction. What you put into it is exactly what you will get out of it. Be negative and you get negative: be positive and you'll get positive results. It may not be today but eventually you'll benefit from your hard work. Too many people are looking for instant gratification or success and are not willing or are unable to put in the time to make the business model work. That is not the nature of business.
Your abiltiy to endure and press on should be an example to people looking to succeed. My parents and grandparents taught me that when things get tough don't blame someone else for your predicament, get moving and find a way to overcome. Obviously, you've done that and to that I say good job.
Going into business for yourself is an investment in self and your abilities. You were given a plan and along the way you found how to make that plan work, regardless. From what I gathered thru your post is that you may have been given lemons and you made lemonade. It took you some time but now you are enjoying the fruits of your investment. Enjoy your drink. Good luck and best of success.
Give them time
Let's just hope when they go to court, people on the jury will be on the side of the people. (The court case coming up where Q is being sued for $74,000,000.)
They lost this battle but the war isn't over.
How were the Q Zees Tricked?
Was it a game of Three Card Monty? How did Q do it? Did they give them false pre-sale information in the UFOC?
Guest on Facts
Ok, I will bite. How do we know anything that you posted is true? That you are not a complete shill for Q?
Michael Webster PhD LLB
Franchise News
Q-Scum Prices NOT Competitive
Quiznos prices to franchisees are not only NOT competitive, they are predatory. For every document they can produce proving "competitive pricing" I can show you items that cost less at the local Sam's or Walmart.
Want some examples? How about potato chips, produce, soft drinks, ham and turkey. From a major restaurant supply store add most meats and cheeses. Pizza chains were complaining about paying 1.70 a pound for mozarella - that same day we were paying $2.50.
You Quiznos apologists can't be convinced that (p)Rick and Lil Dick Schaden are scum and run a crooked operation but you're not who I'm interested in. Those who want to buy a franchise - that's who I'm talking to.
If you buy a Quiznos it'll be the worst decision you ever made. At worst you'll end up bankrupt - owing the bank, suppliers, and the landlord - and you'll wakeup everyday knowing you were screwed.
At best you bought yourself a restaurant job working the line 6-7 days a week making less money than if you had bought a cd with your money and went to work at Sam's. And you'll know everyday of your life that you were screwed by (p)Rick and Lil Dick.
Think you'll be a multi-store owner? Better have a big family. Free labor is the only way you'll acheive that dream - and then everyone is working the line 6-7 days a week. And you'll know everyday of your life that you were screwed by (p)Rick and Lil Dick.
Don't believe me? Buy one. We need additional litigants for the lawsuits file by all the "happy" franchisees.
Why mollycoddle Klein?
He didn''t have an uphill battle on the law. He didn't know the law.
Therre are no antitrust claims in tie in vendors.
Where the contract provides for designated vendors, having to comply with that isn't fraud. There may be othher claims, but that aint one of them.
There are no valid RICO claims against Quiznoose.
Bring claims you don't have is called ignorance of the law - not uphill battle--
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Uphill Fight on law
Interesting to see that it is almost impossible in the federal courts to overcome or overturn the terms of the contract that dummies sign in ignorance of the implications of the contracts for their futures.
The federal judges must be worried about the low IQ of those who come before them and must realize that they certainly aren't experienced business people, or they wouldn't have signed the contracts. No wonder the judges have to scold the franchisee claimants like little children and I'm sure these franchisees will never sign another contract as long as they live without getting help from an attorney.
But, as Richard Solomon has said, a lot of these attorneys are just not competent to read and vet franchise offerings.
The law has been turned into an art form by the likes of Quiznos and MBE-UPS, Cold Stone Creamery, etc. etc...Coffee Beanery, SonaMedSpa, and any franchisor who can maximize his profits by exploiting franchisees to produce gross sales upon which they take royalties while avoiding the risk and expense of owning the physical units that produce the gross sales is smarter than any franchisee any day of the week.
Good for you
More of Quizno's successful, responsible franchisees should stand up and speak up and make their positions known. I am happy to see that you are not from the entitlement crowd that believes the franchisor owes you something or that the franchisor is purposely hiding information from you or lying to you or trying to steal your life's savings . . . some of those things may have indeed happened to you, but you are one of the bright people who understands that you have choices in this world and you don't have to let a franchisor screw you over. Good for you . . . many more years of success in franchising to you -- you deserve it!
Re: Klein had uphill fight on law
Agreed. And Justin Klien has stated he will pursue the matter in State courts, just as you have suggested.
None of the improvements in Q's business model, as they apply to franchisees would have seen the light of day if it was not for the TSFA, Justin Klein and the other attorneys on the case.
That is an undisputable fact and everyone knows it, including Richard Emmett.
No way is Q going public, unless franchise owners see equitable treatment.
Brennaman knows this better than anyone else, as he has stated he indends to settle most of the pending lawsuits as soon as he can .....
I find this hard to believe because number one....
You couldn't be an employee of Quiznos and own a unit as a franchisee. This is/was written in the contracts, so how did you?? Was there a special provision made for you?? I remember questioning this and was told that was the rule. So, are/were you an employee of Q or an independent AD??
My documentation clearly stated no contact with the landlord or the real estate broker so again I ask, how did you do this knowing you were violating the terms of the contract/documentation?? Special provisions??
Start up costs are not disclosed in the UFOC all they refer to is average for a site that is submitted. So, I ask "What happens after you've given them your 25k franchisee fee, 50% of the equipment deposit (upwards of 35-40k) BECAUSE they provided to you an estimate of build-out cost that is easily 25% below the actual end build out cost?? You tellin me that this is the right way of doing things?? They already got ya by the shorthairs knowing that you're into them for tens of thousands before a nail is even hit.
I anxiously await your responses...
Despite what Judge Pallmeyer says it is not fair...
There should be a law against what Quizno's does.
Despite what Judge Pallmeyer says it is not fair...
There should be a law against what Quizno's does.
Disappointed in Paul
Come on Paul, what's going on with you trying to make a post about the actual forum topic?
Unfortunately, this post will be missed by most people because some people are too caught up in the number of pages in the Quizno's UFOC.
Webster the Crank
1. I am not sure who is stupider, the Judge or the franchisee's attorney. The entire point of item 8 disclosure is to allow you to compare franchise systems. Franchise A with royalty rate B and kickback C, might be a better deal that Franchise D with royalty rate E and kickback F. If the moron system doesn't disclose what the numerical rate C and F are, then you cannot compare. If the moron attorney doesn't make this point, you lose the case. (Ironically, it is very pro franchisor attorneys that make this point about comparing systems.) Yet another small pleading point.
2. Franchisees who cannot read, and don't employ attorneys, including Canadian attorneys, who can read will lose their shirt. Judges are saying: too bad, so sad.
3. UFOCs are long and complicated- why do you think that you should be able to understand what is being said without expert help.
I end this note with a recent story. Someone contacted me about franchise x. They were going to buy a US territory for x. X is a complete and utter freaking disaster - but with great bs advertising. The prospect asked me why I thought X was a piece of poo. I said that the mismatch between the contract and marketing was so large, in general, to qualify X as a piece of poo.
Now did the prospect want to know more? No, the idiot wanted me to validate his choice of poo.
Lucky him, he will only lose around 70k.
Michael Webster PhD LLB
Franchise News
My heart goes out to the franchisees.
Court decision or no court decision. I prey those unethical pigs will someday be held responsible for all there wrong doings. My heart goes out to those hard working, hard fighting franchisees. Make no mistake, the word is out on Quiznos (one of the worst franchise investments to ever make). I'll never buy a sandwich again as I do not one dime of my money going in to those pigs pockets. It's my regret that my action hurts the owners. But I will not do business with evil humans.
It's called sells techniques
They razzle dazzle you with comments like, "You will have something no one in Oregon will have." "When you are a success we will be a success." "You will have you own business and that means the sky is the limit on how much you will make." "One day you can sell your business for three times more than you paid for it." "One day your business will grow and you very well may never have to work.You will make enough money so you can go and enjoy yourself." "You can retire never having to worry about money." "Oh by the way will you sign the agreement on Monday or Thursday? At 4:00P.M or 5:00 P.M."
Buy A Q and Live the Nightmare
All the complaints of franchisees have been outlined in past posts and articles. My suggestion to you and any other skeptics is to call Q, talk to the franchisee sales scum, and buy one. They've had to change their sales pitch because of the recent publicity but from what I understand they still lie and I know for a fact you'll still get screwed. Then you won't have to ask any questions - you'll have all your answers.
Webster your's is a fair question...
why do you not ask Carman these kinds of questions as well?
Tricked by the lies and appearances out of contract!
This comment has been moved here.
More Q Experience
Reading “Just the Facts” and “Nature of Business” I thought that each contained many fine points that I hope someone could take and use to their benefit. My Quiznos experience closely resembles that of “Just the Facts” except I came into this franchise having operated restaurants all my life, and having owned a couple of other franchised concepts.
While I have my own list about what I’d like to see different about Quizno’s, I knew that the most important thing that would influence the success of my business after getting a good location would be what we did inside our four walls, and how we could distinguish ourselves from the competition and even other Quiznos. I’ve many times charged less than Quiznos recommended pricing, and in a some instances more, always after I looked at the unit performance, my competition, and what I thought the action would do for my business. I’ve never had anyone from corporate say anything about my prices no matter which way they were.
I’ve had some instant successes and some that we really had to work hard for a period of time before we starting seeing the results we wanted. I’ve even closed a location when the lease was up and re-located to a better spot, a decision that really paid off. I’ve opened some locations as a first generation zee, and have purchased others from existing franchisees, and sold some of the ones that I had. Even opened one, sold it, bought it back, and now I’m going to sell it again to the person operating it.
My wife commented recently when we were talking about a franchisee that we knew that we had never gotten to the point where we gave up and lost hope. We worked at building our business every day, did our own local store marketing, and tried to keep every customer that we got. The quickest way a business person can build their business is to keep their current customers. I’ve seen so many restaurant operators lose a guest over remaking a sub or something else that might cost us $1.50 to make. I do it gladly, and then sample the “mistake” if possible to other guests.
I don’t feel good about seeing anyone go out of business, even a competitor because I know that one day they stood in their new business hoping for a bright and prosperous future as I have done many times, but not everything works out well. Usually when a business fails there is lots of shared blame. There really are no guarantees in anything.
I believe that our new management team has made many positive changes although they certainly aren’t batting 1.000 . I know that is what we want and expect, but again the reality is that doesn’t happen. I’ve found Greg Brenneman to be engaging, open, very driven, demanding of his team, and responsive. I’ve emailed him a few times and always gotten a pretty quick and thoughtful response either addressing my question/concern or forwarding to someone else asking for follow up with me. Rick Schaden didn’t have an email address that we knew about.
My last comment is that I never hear anyone talking about one of the great advantages in a franchise system, your fellow franchisees, and I don’t mean the ones that are failing and blaming everyone. Find the most successful ones, and find out what they are doing. They’re operating the same system, and if they are making it work find out how. Associate with successful people as much as you can. Nothing is gained by discussing how awful things are. Are those successful owners joining in those conversations at meetings? They’re probably busy thinking about how they are going to take information, ideas, products, etc from that meeting and use them to increase sales, provide better service, etc. I’m glad to talk with anyone in our system who asks, and I’ve almost always found that to be the case in other franchisees as well as I’m always looking for fresh ideas. If there are no successful franchisees at all, then that is a real issue, but I know plenty of successful owners out there in the Quizno’s system, and I count myself among them.
Do I sound like a shill
It really is quite irrelevant to me if you think me a shill. I'm not selling anything, rasing capital or running for office. I'm quite busy building my wealth with another very successful, high growth company, in a completely unrelated field.
As I said, I learned a lot along the way and have been able to capitalize on it. I shared my experience only so that some people might realize that the courts are not coming to their rescue and to take the responsibilty for where things go from here. Virtually everyone, Quiznos included, has moved on with their lives and are busy working on the future, and they would be best served to do the same. People can either benefit from my experience and apply it to their own situation, or never learn these basic lessons in life and repeat their failures over and over.
Quiznos was what it was, and is what it is. Nothing said here will change any of that. They continue to sell franchises, open stores and generate billions in annual revenues. These scattered suits are just the cost of growing a brand at the pace in which they grew. The fact is had they not grown as successfully as they did no one would ever have heard of them.
It cost me several hundred thousand dollars and countless hours of sleep to learn these lessons. I offer my observations for free. The definition of wisdom is learning from the experience of others instead of having to experience something for yourself. I wish I had been able to obtain my wisdom the easy, less expensive route. There is a lot of money and success out there for those willing to work hard, take risks, learn and adjust course along the way. There are also numerous safer less rewarding routes for those that prefer a lower risk alternative. As I started out saying in this post, it means nothing to me personally what you do or believe. I've done my part and will continue to do so - Good Luck in all of your endeavors!
The Nature of Business ? The Myth of Franchising
The Myth that franchising provides a business of your own for the franchisee is always spread by people like the above posters.
As a franchiSEE, you are not going into business for yourself and investing in yourself and your abilities. You are investing in the franchisor and his brand name with the hope that the investment will provide a job and profits, as promised by the franchisor. You may own or owe on the assets of the business and the buildout but the franchisor owns you and your gross sales under contract.
Actually, the franchisee is just an egg in the omlet that the franchisor is preparing and even in the failure of the franchisee's investment in the omlet, the egg has contributed to the success of the franchisor.
Even the SBA Advocacy Committee recognizes that a franchisee does not own a business of his own in the true sense of the word and is actually merely a business investment with time limits under the contract, etc.. Those franchisees with successful experience find out the hard way sometimes that their investment is threatened when the franchisor refuses to renew the contract. (See Wikipedia Article on Franchising for Citation)
It is the franchisor who has a business of his own and who owns the franchisee, as a resource, under a binding and airtight franchise agreement that never promises success or profits. Unknowingly, franchisees sign these contracts and agree to these terms and often never achieve success or profits --to their great shock and grief.
Interesting that most small business men/women in franchising who are franchisors cannot get a guaranteed loan from the Small Business Administration because a franchisor is considered to be in legal pyramid sales-type businesses which are not eligible, and it is only the franchisee, the resource, who finances and builds the physical unit on which to wear the brand name who can qualify for a loan to buy a franchise. The franchisee, of course, owns or owes on the assets of the physicasl units and has personally guaranteed both the lease and the franchise agreement, while the franchisor owns only the "paper" contract and the royalties on your gross sales until death do you part.
The franchisor doesn't have any investment in your physical unit, your hard assets, but he can sell you and your contract in the marketplace to the highest bidder without your consent.
Please STOP this hype of The American Dream and A Business of Your Own and all of this Believe and Succeed stuff and discuss why Forbes NOLO published TEN Good Reasons Not to Buy a Franchise and try to put only five good reasons why anyone interested in a business of their own would buy a franchise.
Think again
They need not produce a single document showing the competitveness of their pricing. You bought everything from AFD, an entity they obtained the legal right to put in place because you gave it to them.
The Illinois Law
Paul is wrong. It wasn't an uphill battle - Klein didn't plead the Illinois regulation.
Richard is both right and right. He is right about the anti-trust claims. He is also right that we shouldn't be giving a franchisee lawyer a pass.
You have to plead something that will trump the integration clause. Klein didn't do so -even though the Illinois Franchise Act clearly provides an opportunity to plead the regulation.
Howard Morrill and I had a short discussion about this, in another thread.
Michael Webster PhD LLB
Franchise News
Responsible Franchisees or BS?
I am still calling "bs" on these posts, until there is any evidence that these stories are more than fairy tales.
I especially liked Bob Frankman's observation that franchise vet used the same language as Jim Amos.
Put up some real documents; otherwise it is bs shill talk.
Michael Webster PhD LLB
Franchise News
Entitlement attitude
I have never believed I was entitled to anything. I have raised 5 children on my own. Never went on welfare and bought a home for my family.
In the world of business I do believe everyone is entitled to the truth. In order to make an educated decision to sign or not to sign. Misrepresentation is called lies. Puffing material facts is called lies. Non-disclosure is called lies. It is called selling by deceit.
At a business meeting 50 people took the highway patrol personality test. Only five people were told they were ethical. I was one of them. The rest only want to make the money. Even if it wasn't good for their client.
That is why in most businesses there are rules or laws to protect people from savvy sales people. Why should it be any different in the world of franchising?
Klein's Strategy
Klein ought to come on to BMM and explain his overall strategy. Because most of his decisions so far stink: except for the initial pay-offs that Quiznos thought would get rid of him.
The caselaw has been entirely predictable - and will continue to be so unless he changes legal direction.
Michael Webster PhD LLB
Franchise News
????
The OP never said he is or has ever been a Quiznos corporate employee.
Quiznos site selection
As the facts were reported locally, there is evidence to suggest that Quizno's did act in bad faith viz site selection in New Jersey.
The zees had 12 months to open, and needed zor approval of the location. Rather like Goldilocks, nothing was ever "just right." The store was too big/too small too this/too that... and soon the zee was getting a termination letter.
Then Quiznos turned around and found a new zee to pay $25K and start the process all over again.
If I were a franchisor or a zor-side lobbyist, I would not be defending these guys. The Schadens give franchising a bad name, and the sooner they are gone the better for reputable franchisors.
Paul Steinberg
Franchisee Attorney, New York City, Ph: 212-529-5400
Carman and Do Diligence What Do You Think About Paul's Post?
I am interested in your response.