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Legal News
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Legal NewsUrban City Foods Group (UCFG) (313-963-9805) has filed suit against Burger King Corp. charging that the fast-food chain broke a promise allowing the company to open 225 stores in urban markets nationwide. La Van Hawkins, owner of UCFG, operates seven Burger King restaurants in Detroit and 89 Pizza Hut restaurants in MI. The suit claims that in 1996, Burger King promised Hawkins the opportunity to open 225 Burger King restaurants and then reneged, in effect using Hawkins a pawn to attract other franchise owners "to the otherwise undesirable and less profitable inner-city markets." Hawkins has also sought a temporary injunction to keep Burger King from closing 27 of UCFG’s Bruger King franchise restaurants nationwide. In 1999, Hawkins halted royalty and other payments because he believed Burger King was not honoring its expansion agreement with UCFG, causing the company to lose money. In response, Burger King sued UCFG for royalties and other monies it claimed it extended to Hawkins. A settlement was reached and the suit was dismissed. In 1995, Hawkins received a conditional franchise agreement for 25 Burger King restaurants, and Burger King announced an agreement allowing Hawkins to open the 225 stores currently in dispute in Detroit, New York City, Chicago and Baltimore. Hawkins claims he spent millions of dollars preparing to open the restaurants and now cannot operate the few he has profitably. The lawsuit also claims that Burger King racially discriminated against Hawkins and that Burger King administrators made racial remarks about his business. |