Denver Judge Allows Quiznos Suit to Proceed

District Court Judge Wiley Y. Daniel confirmed the merits of a lawsuit against Quiznos in Denver federal court yesterday, in a move plaintiffs’ lawyer Justin Klein is touting as a victory with nationwide implications.

This case, Bonanno et al v. The Quiznos Franchise Company, LLC et al, is known to franchisees at the “SNO” case – for Sold but Not Open. It’s one of several lawsuits against the Denver-based sandwich chain that I wrote about in May. Bonanno, et al, allege that Quiznos collected more than $75 million in $25,000-franchise fees from more than 3,000 franchisees across the country who never opened stores, and then refused to refund that money, even though the company didn’t help those franchisees find locations as required by their contracts.

Quiznos had filed a motion asking the Court to dismiss the plaintiffs’ eight claims against the company. On March 5, Judge Daniel denied the request on each claim, and also refused the request to dismiss claims against individual owners Richard E. Schaden and Richard F. Schaden.

“Quiznos has publicly tried to discredit the claims alleged by franchisees against the company, calling them ‘meritless’ and ‘tired,’” Klein said in a press release. “This decision shows that Quiznos is wrong.”

This boon came after a Wisconsin judge in November dismissed a federal suit Klein had filed against Quiznos on behalf of franchisees there. The judge did not take a position on state claims in the suit, and Klein has since filed a new lawsuit in state court in Wisconsin. -- Jessica Centers