Officials with the Indiana-based chain and the franchise owners argued their cases before U.S. District Judge Raymond Moore at an all-day hearing on August 23; yesterday the judge gave the company until September 9 to submit more arguments for why it should be granted an injunction against Larry, Christopher and Kathryn Baerns, which would prohibit them from using the Steak 'n Shake name.
Former Westword writer Julie Jargon, who's now a staffer for the Wall Street Journal, profiled the fight between Sardar Biglari, the CEO of Steak 'n Shake, and several franchisees in an article last week. "Relations between Mr. Biglari and his Steak 'n Shake franchisees began to sour three years ago," she reports, "when the chain adopted a policy requiring franchisees to offer a set menu with all items, except breakfast, priced by the company and to offer all company promotions, including one called '4 Meals Under $4.'"
The company claims that the Baernses did not offer the value menu, and charged more for other items. And in July, Steak 'n Shake terminated their franchise agreement -- and earlier this month, cut off their access to the company's computer system.
Moore granted the Baernses a temporary restraining order, ensuring that their two restaurants can use the system. The franchisees have countersued the company, saying Steak 'n Shake misrepresented how much money they could make from their restaurants. And they're not alone in those complaints. As Jargon reports, Steak 'n Shake's oldest franchisee sued the company, and three other franchisees have cases pending in the Indiana courts.
There's a whole lotta shaking going on at Steak 'n Shake these days.