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FOR IMMEDIATE RELEASE
CONTACTS: L. Michael Hankes, Esq.
63 Commercial Wharf
Boston, MA 02110
(617) 723-1144
Los Angeles, CA
Peter C. Lagarias, Esq.
1629 Fifth Ave.
San Rafael, CA 94901
(415) 460-0100
Federal Court Accepts Franchisee Victims’ Amended Complaint Against United Parcel Service (UPS)
A group of small business owners (The Brown Shield Association, BSA) unites against shipping Goliath UPS, citing omissions, non-disclosure, unfair practices, breach of contract, and predatory practices for franchised locations.
Los Angeles, CA (March 22, 2007) - A substantially revised amended class action lawsuit against UPS was accepted earlier this month by the United States District Court – Central District of California. The amended complaint was filed by more than 220 franchisees of The UPS Store. The franchisees contend that, among other claims, UPS omitted and/or did not disclose relevant information to franchisees opening new The UPS Store locations and those franchisees switching from the MBE brand to The UPS Store brand; UPS made false claims about how well The UPS Store would perform financially; UPS competes and uses information from the franchisee to acquire customers for UPS directly, bypassing the franchisee altogether.
“Corporate greed is still alive and well in America” says Larry Bowdoin, President of the Brown Shield Association (BSA), and a franchisee himself in Alabama. ”UPS likes to call us a minor number of disgruntled franchisees. We’re just one group. What UPS doesn’t want you to ask is how many additional lawsuits from franchisees are there?”.
Bowdoin continued, “No franchisee could have forseen that our biggest competitor would have been our franchisor, UPS itself. There have been many instances of UPS luring away our [franchisee] customers, often with incentives, affecting the franchisees’ profits. UPS makes more money that way, with no regard to our bottom line. The more money per package that they get doing it that way adds up to tens of millions of dollars of extra profit for them. They don’t care that we have rent, employees, health care to pay for out of our own pockets”.
“Had information been fully disclosed regarding profitability, missing test market data, and unfair trade practices, the franchisees would have been able to see that UPS was pulling a fast one on us”, said Bob Strickland, VP of the BSA and a franchisee from Virginia. “This is not a viable business to be in,” he continued. “Instead, we have people filing bankruptcy, drying out their retirement accounts, maxing out their home equity line of credit - it’s a travesty. We’re fighting back for all of the exploitation that UPS has done to us”.
The BSA represents a wide range of franchisees from around the country.
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