Can litigation be used to gag New Zealand franchisees?

September 24, 2008

I dislike when anyone tries to decrease freedom of speech, especially on the internet.

  • Maybe it’s because I was sued [1, 2, 3 & 4] about this very issue, that I am fairly touchy about the subject.

Right and wrong has nothing to do with it. It’s the Golden Rule: Whoever has the gold, makes the rules.

Since Australia and New Zealand are in the franchise regulation news lately, here are three August 2001 articles from Jon Stephenson of The Independent that illustrate how little distinction some franchisors make between fundamental human rights freedoms and their ability to control their message.

You may note that it was only after the original court decision was reversed that the 13 Wordsites International franchisees regained their ability to defend themselves.

I have seen the names Worldsites International Network and WSI applied to the same Canadian-based system. Based on their membership information at the Canadian Franchise Association, WSI has been a CFA member since 2007, has over 1,500 franchises and has been franchising since 1996. I recall that Dan Monaghan and Nigel Mayne co-founded WSI.

WSI and Mr. Monaghan are involved with Make Child Poverty History.

Nigel Mayne is listed by the CFA as president of MatchPoint which claims to be “Canada’s largest Franchise broker.” (In business since 2006, CFA member since 2007).

  • Constitutional rights can be taken away and you have to fight to have them restored. Better have US$20,000 buried in the back yard if you want to live to fight another day.

BTW, whenever you see the following it should be a very red flag for you:

  • this franchise is the next “McDonald’s of dog poop business” for example, and
  • franchisor registered in Bahamas with disputes heard in Delaware, U.S.A.

I wonder what happened to the unlucky 13?

These articles brought to you by the fine people at the Informaton Sharing Project.


A Rare and useful Gripe Site model

September 2, 2008

Anthony’s Franchise Information is a very instructive website for several reasons.

1. It shows how frequently a franchisor will start with one system (3 for 1 Pizza and Wings) and then branch out to other ones (Pizza One, Anthony’s Pizza Uno and Anthony’s Kitchen) once things become a little too “complicated”.

Changing countries and having your mother own the new corporate entities is a nifty way to dodge franchise law obligations. While it may no be legal, it is up to the usually broke future franchisees to prove a wrongdoing has happened. Chance of that happening: slim to none.

2. Just look at the string of Court decisions and unfulfilled awards against Mr. Reza (above, aka Anthony)  Solhi.

There is a lesson to be had here: Go ahead and sue and then try to collect your award. You frequently can’t. Often the assets have left the building way before the always-appealed trial decision is handed down.

3. Notice how there has been national television and newspaper coverage, even with a two part investigative coverage from the award-winning CTV W5 program (Taking your Dough)?

  • Think that a lot of publicity will make the bottom-feeders pay? Think again.
  • Think the “blue chip” systems will give up the slimiest? Think again: They both share the same group of invisible friends.
  • Think if they only knew they’d do something? Think again.

4. Read the Petition Narratives. These all represent new Canadian families that thought Canada was an advanced western democracy that protected its citizens. I hope they realize that all franchises have this potential. These guys were just impatient.

5. This is a very clear, concise and well-documented picture of 1 of the 1,200 franchise systems in Canada. It is only still up on the internet because the franchisor has not funded an aggressive litigation attack on the people that wrote it.

A more reputable or blue chip system would have served papers within 2 days and driven them all into bankruptcy to teach them a lesson. Standard operating procedure when the Franchise Bar runs the industry’s protection racket.

6. I like the inclusion of Known Associates. That name Nigel Mayne rings a bell but I can’t for the life of me remember why. Anybody in cyperspace help me out here?

7. How unwilling the Ontario government is willing to even look at revising the toothless Arthur Wishart Act (Franchise Disclosure), 2000 law. I know of and have met Minister Phillips and he is personally a man of extremely high character. As a cabinet member, however, he must toe the government’s policy.

  • If the Ontario and Canadian government will so blatantly block for the sleaziest of the franchise industry, what makes you think any other country is to do anything other than pay lip service to franchise investors?
  • Political stripe and jurisdiction are immaterial. As individuals, I know politicians and civil servants find defending a turd to be distasteful but they have no choice: It’s about Big Franchising‘s influence.

Franchisees would have to MATCH the combined political clout (investment, jobs) of all the automotive manufacturers, the national grocery chains, petroleum companies, product franchisors, largest law firms, financial institutions, etc. to have a fair fight at a real franchise law.

  • Yes, the truth has some weight. But often power defines what is true in a real politics.
  • The trick is not to give up but to resist in a more effective way.

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