After a nine-year legal battle, the Superior Court of Québec’s Justice Daniel H. Tingley has ordered Dunkin’ Brands Canada Ltd. to pay plaintiffs $16.4 million in damages and costs — exactly what was claimed by the franchisees.
In his ruling in Bertico Inc. v. Dunkin’ Brands Canada Ltd., Tingley found in favour of Dunkin’ Donuts’ former franchisees, who were suing the franchisor for incompetence, negligence, lack of support and assistance, as well as flagrant breach of the contract entered into between the franchisor and its franchisees. The latter applied, in particular, to protect and enhance the brand between 1995 and 2005 — a period when Tim Hortons and other coffee franchises in the province were rising in popularity.
“This is one of the longest franchise litigation battles, probably in Canadian history, and definitely in Quebec franchise history, and I think it sends a strong signal,” says Frederic Gilbert of Fasken Martineau DuMoulin LLP who acted for the plaintiffs. “Not only franchisors but franchisees in the franchise industry in Canada should acknowledge this decision and say, ‘how does this impact my business?’”