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Quiznos to Pay $2M in Canadian Settlement

UPDATE (July 24) - QUIZNOS RESPONDS 

Judge Praises Franchisee Lawyer for Diligence

ONTARIO, Canada (Blue MauMau) - A judge in Ontario has approved a $2 million settlement for franchisees in Canada, according to a report from TheStar.com business section. Attorneys defending against a class-action lawsuit also assured the judge that Quiznos has addressed causes of past grievances. The settlement will allow the Quiznos Sub sandwich chain to refund part of an estimated 170 deposits and taxes. It will cover losses for more than 25 franchisees who lost deposits and taxes in the range of $30,000 each. Attorney Ben Hanuka, who negotiated and recommended the deal, represented franchisees who lost money when they could not find a location for a shop within the 15-month period allowed in the franchise agreement.

Judge Maurice Cullity of the Ontario Superior Court of Justice praised Hanuka for his diligence and tenacity, stating that he gave great weight to his professional judgment. He also agreed that he should be paid up to $450,000 or 20 percent of the total settlement for attorney fees. In his ruling he acknowledged, "The intensity of the disappointment, frustration and the anger directed at Quiznos was evident."

Justin Klein, Marks & Klein, attorney for franchisees in various lawsuits in the United States said, "This is a good result for the people in Canada.  I am happy to see that Quiznos has at least given some money back to those franchisees." Klein said the problems in the U.S. are much more widespread and the numbers are more substantial, but he hopes Quiznos will take the right steps to make some of them whole as well.  If not, he said they will move forward to determine in the courts if the franchisors actions were harmful.

UPDATE: 

Rich Emmett, Quiznos Chief Legal Counsel, responded, “We believe that settling this matter is best for everyone concerned.  It’s good for Quiznos and it’s good for our Canadian franchisees.  This milestone settlement will allow all of us to move forward together toward growing and reinvigorating the Quiznos Brand in this very important market.” . 

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About Janet Sparks

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Public Profile

Janet Sparks is the former publisher of the Continental Franchise Review, an industry newsletter that covered the franchise community for over 30 years. She has also been a columnist for a leading franchise magazine for the past 13 years. Today she is an independent journalist who engages in investigative reporting, tackling complex issues that impact the franchise industry.

Janet can be reached at jsparks@bluemaumau.org or at 303-799-7398.