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National Class Action Filed Against Quiznos

Janet Sparks's picture
Posted Wed, 2007/08/15 - 12:40 by Janet Sparks

BREAKING NEWS!! Franchisees Across Nation File Suit, Quiznos Will Not Comment until Receive Complaint

DENVER (Blue MauMau) - Attorney Justin M. Klein, Marks & Klein, filed a class-action lawsuit yesterday against Quiznos Sub, on behalf of an estimated 5,000 franchisees across the nation. The lawsuit was filed in the U.S. District Court for the District of Colorado. This latest legal action is alleging that the Denver-based franchisor has systematically defrauded the franchisees in a scheme designed to build the brand at the expense of its operators. Several other class actions have been filed against Quiznos in states including Illinois, Michigan and Wisconsin.

In regard to the lawsuit, Danny Kessels, the incoming president of the Toasted Subs Franchisee Association, stated that the success of the system is dependent upon the success of its franchisees. He said, "We have some internal issues we need to resolve. Basically, I am a franchise owner and part of the Quiznos chain, so like others, my main goal is still to provide the best sandwich possible to the customer. We will continue to try to be the leader in this industry." Kessels said that is the goal of the individual franchisees and the corporation.

The lawsuit alleges that Quiznos forces franchisees to buy food, supplies, and services from Quiznos or its affiliates at drastically inflated prices while concurrently setting artificially low retail prices for its products. According to the complaint, that is what makes the stores unprofitable in many situations. It also claims that the franchisor unlawfully participates in a scheme to sell franchises by omitting or otherwise misrepresenting key facts about Quiznos' business operations. In seeking damages for lost investments, as well as injunctive relief, the lawsuit alleges statutory and common law fraud, violations of federal and state antitrust laws, violations of Racketeer Influenced and Corrupt Organizations (RICO) Act, breach of contract and violations of Colorado franchise and consumer protection laws.

A spokesperson for Quiznos said they had not received a copy of this latest class action lawsuit. As soon as they read the complaint they will comment.

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Quiznos by Guest
Submitted by Guest on Mon, 2007/08/20 - 14:23.
Guess I should wait on buying a Quiznos
Thumb on the Franchise Pulse by Don Sniegowski
Don Sniegowski's picture
Submitted by Don Sniegowski on Wed, 2007/08/15 - 17:36.
Congratulations Janet for covering yet another franchise story before the rest of the media. The newswires haven't even begun to digest this yet. Maybe in tomorrow's news ...
Actual Reporting... by Guest
Submitted by Guest on Wed, 2007/08/15 - 17:53.
Well done and nice to see!
Proud To Be TSFA by Guest
Submitted by Guest on Wed, 2007/08/15 - 19:21.
Now we, the franchisees that built and support this system, will finally get answers. Now we'll see and hear how Quiznos planned and executed the systematic siphoning of franchisee wealth. Outrageous food prices and kickbacks, outrageous equipment prices and kickbacks, an outdated POS system sold for thousands of dollars, encroachment, predatory coupons, millions in ad money misused on late night cable outlets and poorly produced ads, no accountability, and intimidation that led to the suicide of one franchisee. I joined the TSFA because only a strong franchisee organization could stop this franchisor's unethical, and I believe, illegal practices. I've waited a long time for this day. TSFA, I'm proud to be on your team.
Digest What?? by Guest
Submitted by Guest on Wed, 2007/08/15 - 20:21.
What is so important about another class action lawsuit? This has been going on for years and is hardly newsworthy. Suing Quiznos and getting any meaningful benefit to franchise owners is years away even if is sees the light of day. Greg Brenneman came on strong but is fading fast. System wide sales are slumping due to the lack of any meaningful advertising campaign. $10,000 additional profit per store for 2007. Give me a break Greg. Quiznos is stealing our national advertising money and giving us nothing in return. We went through the summer with basically no advertising except sparse television commercials and their e-mail loyalty blast. Where is our ad money Greg!!
Quiznos by Guest
Submitted by Guest on Mon, 2007/08/20 - 17:23.
Don't just wait. Don't ever buy. If you sign the franchise agreement you will regret it and you'll have no-one to blame but yourself.
Quiznos Corporate Bonus Program by Guest
Submitted by Guest on Wed, 2007/08/15 - 21:59.
Mr. Brenneman stated early in his tenure that all Quiznos corporate employees would be bonused based on franchise owner profitability. Guess what will be in the corporate stocking come Christmas time? Nothing, Nada. Empty promises and disappointing results.