Subway Gains Control Of SFAFT In Suit Settlement

QSR Web:

Subway parent company Doctor’s Associates Inc. and the Subway Franchisee Advertising Fund Trust (SFAFT) have settled four years of litigation, reports Blue MauMau. The settlement allows DAI to regain control of the SFAFT.

From the story:

In the case, Jeffrey Offutt, Trustee v. Doctor’s Associates, Inc., a federal judge issued his written decision that the parent company has the right to make changes to its franchise agreements in a manner that enables it to divert funds from the SFAFT and direct them into a new advertising trust fund. In his May 4 order, Judge Alvin W. Thompson affirmed his oral decision made on December 21, stating that the settlement agreement now reached among the parties was “fair, just and reasonable under the facts, relevant law and other circumstances of the case.” …

Today there is in excess of $600 million a year that passes through the advertising fund, for which franchisees pay 4.5 percent of their gross sales. The settlement affects Subway franchise owners worldwide.

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