June 30, 2011
Lab Test Franchisees Open New Business; Franchisor Concedes Non-Compete Can’t be Enforced, says Franchise Lawyer W. Michael Garner
Two former Miami franchisees of “Any Lab Test Now” have successfully challenged the post-termination covenants not to compete in their franchise agreements, and have left the Any Lab Test system to open Unilab Express, according to Jason Baumann, President of Unilab
Miami, FL (PRWEB) June 29, 2011
Two former franchisees of “Any Lab Test Now” have successfully challenged the post-termination covenants not to compete in their franchise agreements, and have left the Any Lab Test system, according to the franchisees, Jason Baumann and Orlando Fernandez.
Baumann and Fernandez, formerly franchisees of Any Test Franchising of Atlanta, Georgia, a franchisor of walk-in laboratory services, have now opened business under their own flag known as “Unilab Express.” Baumann commented, “We hope to better serve the Miami public with a broader range of services, the availability of a physician, and better compliance with Florida’s strict patient privacy rules.”
Last week, Baumann and Fernandez wrote to the franchisor, announcing that they were leaving the system and pointing out that the franchise agreement’s covenant not to compete, which would otherwise have put them out of business, was not enforceable under Georgia law.
Joe Neely, President of Any Test Franchising, Inc., wrote back to both of the franchisees agreeing with their letters and accepting the terminations.
“The non-competes are fatally flawed under Georgia law,” said W. Michael Garner, attorney for the franchisees. “The Supreme Court of Georgia has held that provisions containing exactly the same language were unenforceable. The franchisor was smart to do this and avoid a legal fight that would have resulted in a legal precedent.” Baumann and Fernandez had raised their allegations that the non-compete was invalid in a lawsuit in Miami-Dade Circuit Court, Baumann et al v. Any Test Franchising, Inc. case no. 11-18661 CA 15.
Baumann and Fernandez, together with several other franchisees, are also suing the founder and owner of Any Test Franchising, David Lageschulte, of Fort Myers, for alleged fraud and misrepresentation made in connection with the sale to them of their Any Lab Test franchises. “We are pleased to have been able to sever our relationship with this franchisor.” Fernandez said. The case, Baumann et al. v. Lageschulte, No. 11-19072 CA 05, is pending in the Circuit Court of Miami-Dade County.
Walk-in laboratory facilities are becoming highly popular because of their convenience and low cost. A drug test, for example, can be obtained at Unilab Express for $39.
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June 23, 2011
Any Lab Test Now, a chain of walk-in labs, has 130 franchised stores in 26 states. It is managed by Joe Neely, Chief Executive Officer; Clarissa Bradstock, Chief Operating Officer; and Terri McCulloch, Vice President Sales and Marketing. Bradstock is married to prominent Olympic athlete Roald Bradstock, who is seeking a final appearance in 2012 Olympics under the British flag.
Seven present and former franchisees of “Any Lab Test Now,” a walk-in lab facility franchise owned by Atlanta-based Any Test Franchising, have sued David Lageschulte, the founder and owner of the franchise, in Miami Circuit Court for unfair trade practices in the sale of their franchises. They seek over $10 million for fraudulent conduct in the sale of the franchise. Lageschulte, reportedly a billionaire, is the owner of LTP Management and numerous franchised restaurants.
According to franchise attorney Michael Garner, who is representing the franchise owners, “Any Lab Test Now selectively presented the best information and hid what was most relevant — how their actual franchisees were doing. The law doesn’t allow you to start talking about profitability, and then be one-sided about it.”
“They started their sales presentation with an endorsement from Lags,” said Jason Baumann, one of the plaintiffs, referring to Lageschulte’s nickname. “He said that franchising was the way to get rich.” Exhibits to the complaint show Lageschulte’s quote, surrounded by logos from prominent franchisors such as Hooters, Ugly Tuna, and Dan Marino’s. The written presentations go on to extol the success of the franchise’s stores in Atlanta.
Referring to the allegedly blatant earnings claims in the presentation Garner said “That’s plainly a violation of franchise sales laws. Lageschulte knows that Any Lab Test Now can’t sell franchises by hawking it this way. They have to put it in a disclosure document.”
The case seeks the value of the business that Lageschulte’s endorsement held out to them. “Based on the information in the written sales pitches,” Baumann explained, “we should be entitled to damages of at least $10 million before any punitive damages or attorneys’ fees.” The franchisees’ case is similar to an action brought by investors in the Trump International Hotel and Tower in Ft. Lauderdale. Although Donald Trump was not the developer of that project, and was lending his name to it for a fee, the court held he could be held liable under the Unfair Trade Practices Act.
“I would never have bought this Any Lab Test Now franchise if I had known the actual performance of the franchisees,” said Baumann. “We were shown several sets of figures and told they were representative. In fact, the franchisor, Any Lab Test Now, was sitting on data from its existing franchisees that showed much worse performance.”
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