Sona Medspa, A Franchisee’s Tale
As a party very interested in assuring that the truth is told about Sona MedSpa and my Arbitration case I have written the following response to comments of an arbitration “win” from Heather Rose.
Heather Rose, CEO of Sôna MedSpa stated, "This case was one of a string of cases brought against us. The coordinated attack on our business has utterly failed. We are pleased with the result of this arbitration, and even more pleased that our franchise partners are enjoying prosperity in their Sôna MedSpa businesses." - BusinessWire, June 7, 2007
I also want to respond to what Matthew Shay said in Franchise Times, June 2007 about the Sona arbitration. Mr. Shay is the chairman of the International Franchise Association (IFA), a position that Jim Amos of Sona Medspa fame has once shared and an organization he is active in.
“Based on the Arbitrator’s decision which overwhelmingly ruled against the plaintiffs, there is nothing the IFA deems worthy pursuing. To call one minor finding anything other than insignificant could frighten away other potential equity investors whose financial support provides the capital resources necessary for franchises to continue expanding and providing opportunities for prospective new investors. That could have a directly opposite effect and harm the very people some observers claim they are trying to protect --- franchise investors.”
Sona MedSpa is a true American tragedy, where many families lost their entire or a substantial part of their life savings. The losses are well in to the millions of dollars that these various families lost. It is about an imperfect if not actually fraudulent franchise model which simply did not work against any known medically proven concept. The business model was based on at best a deceptive cash based financial model.
This is a story about highly professional people (CEOs, JDs, MBAs, CPAs, MDs and other Professionals), who bought in to a “turn key” concept with a high cost of entry and then over time failed.
My name is Kempton J. Coady, III and I was one of the litigants against Sona in the recent Arbitration against them. Sona and Carousel did not overwhelmingly win in fact the Coadys “Won.” The following quote is from Mr. Garner of Dady & Garner, PC, attorney for the plaintiffs.
"We prevailed on negligent misrepresentation and recovered money ($400,000 not a small amount!). Sona, which had counterclaims against the Coadys originally in the range of $7 million dollars, (later trimmed down to somewhere between $1 and $2 million dollars) recovered 'nothing.
On my scorecard, that’s a win for my team and a goose egg for the other side. You don’t say that the team that wins the game by one run was the losing team. It was the winner, and win we did.”
It should be noted also that Jones, Wilson, Amos, and Rose of Sona and Schwabb, II, Schmidly, and Pitt of Carousel were found “personally liable” for the monetary damages.
Here are the facts about Sona, what happened and the terrible effects on the families of its franchisees.
