April 30, 2009, Toronto – The Ontario
Divisional Court approved for certification a Canada-wide class action lawsuit
brought by Quiznos franchisees against their franchisor and its designated
supplier, Gordon Food Services (GFS).
The class action alleges that Quiznos
violated its franchise agreements and the federal Competition Act by acting
together with GFS to artificially inflate prices paid by Quiznos operators for
their supplies and that such practices violate laws requiring franchisors to
deal fairly with their franchisees.
According to Douglas Johnson, the lead
plaintiff and President of Quiznos' Canadian franchisee association, "It
is vital that franchisees have access to competitively priced supplies in order
to have a chance to succeed. Without the ability to bring this case forward as
a group, franchisees face insurmountable obstacles in enforcing their legal
rights. We now have a real chance to fix the problems of the past and help
franchisees in the future."
Quiznos franchisees have long complained
about overcharging on supplies, but the franchisees' efforts to stop the
alleged overcharging were resisted by Quiznos and GFS. In considering the
suitability of Quiznos franchisees asserting their claims as a class action,
the court endorsed the franchisees' right to seek justice as a group. The court
gave numerous reasons for believing a class action "would be preferable to
any alternative to resolving this claim." Best advancing access to justice
was among these reasons.
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