January 19, 2011

Globe: Revolt of the franchisees

The Globe and Mail has published an article profiling Robert Rodger, the representative plaintiff in the recently certified and ongoing class action against Pet Valu. Sotos lawyer David Sterns is quoted in the article:

Class actions allows franchisees to band together and more easily to take on their corporate parent, Mr. Sterns said, although only one representative plaintiff is needed to proceed. The cases often revolve around how the franchisor uses its power to set the prices – both the prices that franchisees must pay for the products they sell, and how much they can sell them for.

“It’s about dividing up the profit pie. And the person who has the pie cutter is the franchisor. And so, they cut themselves the biggest piece,” Mr. Sterns said. “But on the other hand, the franchisees are the ones who put a lot of investment into making the pie.”

Read the rest of the article at the Globe and Mail

Go to the Pet Valu class action home page