Arbitration Scheduled Between Franchisee and Planet Beach

The long awaited arbitration between franchisee Barnhill and Planet Beach Franchising Corporation is scheduled for late April 2011.

Claims set forth in the arbitration demand address a number of matters/issues that relate to Planet Beach Franchising Corporation relationships with its franchisees generally.  Those include:

• Planet Beach Franchising Corporation charging its franchisees a "tech fee" that was not disclosed in the UFOC/FDD, nor provided for in Planet Beach Franchising Corporation  franchise agreements.
•  Requiring the payment of additional fees for software, and requiring the acquisition of new software [i.e. Millennium] by franchisees, when Planet Beach Franchising Corporation was obligated to provide such software, and updates, in consideration of the ongoing royalty fee payments.
• That Planet Beach Franchising Corporation failed to uniformly collect royalty and ad fees from its fr'ees, thereby undermining the system.
• That Planet Beach Franchising Corporation substantially altered the disclosed and agreed upon tanning concept, replacing it with a "spa concept", resulting in an unauthorized and improper "system-wide change",  thereby substantially increasing the  cost of implementation and fr'ee burdens, and undermining the franchise system.
• That, in violation of its franchise agreements,  Planet Beach Franchising Corporation improperly prohibited its fr'ees from purchasing identical approved tanning supplies, and equipment,  from alternative suppliers at lower prices, making Planet Beach Franchising Corporation the only "authorized" supplier at prices that were 25-30% higher, in violation of applicable anti-trust laws intended to promote competition.
• That PLANET BEACH FRANCHISING Corporation’s actions have violated its obligations to the Barnhills, and to Planet Beach Franchising Corporation's franchisees as a whole.
• The Barnhills are seeking damages in excess of $100K, a decision that Planet Beach Franchising Corporation's actions have violated its obligations to the Planet Beach Franchising Corporation franchise network, and full reimbursement for all fees and costs incurred by the Barnhills regarding this dispute.
• The arbitration hearing is presently scheduled for late April, 2011.

Because the issues in dispute in this matter are important to the Planet Beach Franchising Corporation franchisee network, we will keep you regularly informed as this matter moves forward to the arbitration date.

__________

Questions about this article should be submitted to rfarrell@farrell-lawgroup.com