Pittsburgh Tribune-Review:

A group of Quiznos franchise holders have filed a class-action suit in Pittsburgh against the sandwich company accusing it of racketeering and violating the Sherman Anti-Trust Act.

The suit was filed in U.S. District Court on July 3 and includes plaintiffs from Allegheny, Westmoreland, Lawrence and Beaver counties.

Colorado-based Quiznos denied the allegations yesterday.

The lawsuit involves restaurants in Pittsburgh, Greensburg, Mt. Pleasant, North Huntingdon, Beaver Falls, Monaca, Center Township and New Castle.

According to the company’s website, there are about 25 franchise stores in Western Pennsylvania.

The defendants include the company, subsidiaries and company officials.

The lawsuit alleges that Quiznos engages in a “pattern of racketeering” and generates “grossly inflated profits” at the expense of franchises that usually fail.

It also accuses the company of saturating geographic areas with more franchises that can be supported.

Quiznos is accused of allowing customers to redeem coupons for free or discounted sandwiches, a practice that allegedly benefits the company but not the franchise holders, who are not compensated for the loss of revenue, according to the lawsuit.

Quiznos, according to the filing, requires its franchise owners to buy products they do not need and work only with suppliers that are connected to Quiznos who charge high prices.

The financial strain on the franchisees causes the business to fail, the suit maintains.

Logo from Quiznos.

Originally posted by Angela Shupe on July 9, 2008 in Franchise Site.


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