ATLANTA In another dispute over a restaurant segment's legal definition, a franchisee of Atlanta Bread Co. has sued the bakery-cafe chain's franchisor for wrongful termination of his agreement to operate five units, according to published reports.
The franchisee, Sean Lupton-Smith, is seeking $12 million in damages from Atlanta Bread Co. International Inc. here. He alleges that the company had no right to disenfranchise him for opening an Atlanta unit of Raving Brand's PJ's Coffee and Lounge chain because that concept does not compete directly with Atlanta Bread. But ABC International apparently asserted that PJ's is a bakery-deli like Atlanta Bread, and that Lupton-Smith was forbidden under his contract from operating a rival brand. Lupton-Smith told the Atlanta Business Chronicle that he regards PJ's as a bar, not a bakery-deli.
The parties are awaiting a trial date for the suit, which was filed in February, according to the Chronicle story.
The situation is reminiscent of a dispute last year that pitted a Panera Bread franchisee against its landlord, a shopping mall in Shrewsbury, Mass. The Panera operator sought an injunction to stop the mall from allowing the addition of a Qdoba burrito outlet in the same mall, citing protections against the opening of a competing sandwich brand. A court ruled that a burrito is not a sandwich.
