June 27, 2006
Subway Franchise Lawsuit
Posted by Gordon Smith

One of the testy and recurring issues in franchising has to do with how the franchisor uses the funds collected from the franchisees for marketing. Subway established a trust in 1990 to manage those funds, but the trust is now suing Subway's founder and Doctor's Associates Inc. (the franchisor) for changing the franchise agreement in a manner that disregards earlier commitments. I will try to track down the complaint and/or the franchise agreement here because the news stories are too sparse for much analysis, but this looks like it could be an interesting case.

Thanks to former student Juan Lozano for the tip.

Contracts, Franchising | Bookmark

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