Antitrust Law Daily Wrap Up, FRANCHISING & DISTRIBUTION NEWS: Custom sign franchisor alleges breach of contract and trademark infringement by former franchisee, (Jan 6, 2014)
Law Firms Mentioned:Parr Brown Gee & Loveless, P.C.
Organizations Mentioned:Parr Brown Gee & Loveless, PC | YESCO Franchising LLC
By Linda O’Brien, J.D., LL.M.
A former franchisee has breached the franchise agreement and infringed the trademark of a custom sign franchisor, among other claims, according to a complaint filed in the federal district court of Salt Lake City (YESCO Franchising LLC v. Roth, January 3, 2014).
YESCO Franchising LLC is a designer and builder of custom signs, including outdoor advertising billboards, electric signs, specialty signs, and custom signs. The complaint alleges that, in November 2012, William Roth, d/b/a Signcraft, entered into a franchise agreement with YESCO and was granted certain non-exclusive rights related to the territory of Charlotte, North Carolina and some surrounding areas. Roth also executed a secured promissory note to repay a loan by YESCO for the franchise fee.
In December 2013, YESCO notified Roth of various breaches that existed under the franchise agreement. The complaint asserts that Roth failed to achieve certain sales quota, license equipment, use proprietary software provided by YESCO, or repay the amounts owed under the promissory note. He had also infringed YESCO’s trademark and interfered with YESCO’s existing and prospective customer relationships. Roth responded by making various threats in an email to YESCO representatives and operated his business in violation of the franchise agreement, according to the complaint. In January 2014, YESCO notified Roth of its termination of the franchise agreement and intent to enforce its rights under the agreement and promissory note.
YESCO asserts claims for breach of contract, breach of implied covenant of good faith and fair dealing, tortious interference with economic relationships, and trademark in violation of the Lanham Act. The action seeks declaratory and injunctive relief, damages, pre- and post-judgment interest, costs of suit, attorneys’ fees, and any other just and proper relief.
The case is No. 2:14-cv-00003-RJS.
Attorneys: James L. Ahlstrom (Parr Brown Gee & Loveless, P.C.) for YESCO Franchising LLC.
Companies: YESCO Franchising LLC
News: FranchisingDistribution UtahNews