MIAMI — Popular restaurant chain Tim Hortons accuses of a group of Michigan franchisees of not paying fees owed by a contract.
Tim Hortons USA, Inc. and Tim Donut U.S. Limited Inc. filed the lawsuit on Oct. 9 in the U.S. District Court for the Southern District of Florida against the owners of seven stores in Michigan.
According to the complaint, the franchisees did not make required payments under the franchise agreement for "royalties, advertising and other fees."
“Specifically, the franchise agreements require that the companies pay [Tim Hortons USA] a royalty of a certain percentage of weekly gross sales in return for the use of the Tim Hortons System and the [Tim Hortons] marks,” the complaint states.
The agreement also obligates the franchisees to pay "fan amount equal to a certain percentage of company's monthly gross sales for the preceding calendar month in return for advertising, sales promotion and public relations expenditures."
The franchisees named in the suit are located in Detroit, Southfield, Redford and Harper Woods. The stores signed the contracts in 2016.
Tim Hortons USA is represented by Nina Greene of the Miami-based firm Genovese Joblove & Battista P.A.
U.S. District Court for the Southern District of Florida, Miami Division Case No. 1:18-cv-24152