BEST BLINDS: Lissa Wall-McMahel Fires Back re Franchise Lawsuit

Unhappy Franchisee – Best Blinds franchise owners Eric & Laurie Wilson claim that they bought a Best Blinds franchise, but then found out the franchisor had already sold the exclusive territory rights to someone else. 

The Wilson’s sued and won. 

However, the Wilson’s claim the blind company ducked out of paying the judgement by declaring bankruptcy.

When UnhappyFranchisee.com posted the outcome of the lawsuit (read BEST BLINDS Franchise Complaints), Eric Wilson added a warning in the comments section:

…Lisa Wall-McMahel is continuing to do business as usual under the premise that her husband Darren McMahel is the president.

They have also started a “new” business doing the same thing as before, but not offering territories. Buyers BEWARE!!! The “new” scam business can be found at bestblinds.biz The training she is offering can be obtained free by vendors and the wholesale pricing is better directly negotiated with the vendor. She is hoping to create a buying group through her, at higher prices, so that she can receive vendor incentives and rebates. By the way, this is her second filing of bankruptcy. She has played this game before.

Lissa Wall-McMahel responded with a long comment alleging that there was no fraud involved, and that the Wilsons’ took advantage of the court system and, basically, destroyed the Best Blinds franchise program.  Rather than being franchise victims, Lissa McMahel alleges, their actions actually did damage to the dealers who benefitted from the now-dismantled Best Blinds franchise program.

Lissa Wall-McMahel wrote:

“Mr. & Mrs. Wilson were the FIRST franchisees for Best Blinds – prior to that territories were awarded through Business Training Agreements that were not in compliance (unknowingly) with FTC rule on franchising. Best Blinds was converting to a franchise program when the Wilsons made their original contact.

“Mr. Wilson left out a few KEY details in his complaint, as listed below:

“1-Mr. Wilson was FULLY aware of the other person (not a franchise) who had the rights to PART of the territory in which he purchased, since that person referred him to Best Blinds while on a sales call at the Wilsons’ home, with what Mr. Wilson said was “rave” reviews of Best Blinds and me as a person. He even supposedly told Mr. Wilson that he no longer wished to provide service within that territory.

“2-Mr. Wilson was notified PRIOR to training that the agreement had been submitted to the other party, but not signed, and Mr. Wilson chose to go through with the training anyway.

”3-Mr. Wilson was offered his money back plus $6k in attorneys fees prior to filing his lawsuit, but turned it down (supposedly due to the non competition clause in the termination agreement, that protected Best Blinds against other possible litigation).

“4-Mr. Wilsons allegation of FRAUD AND DECEIT is untrue and unfounded since neither judge found FRAUD, and the Wilsons were aware at all times of the other territory owner and were speaking with him (doing “due diligence”) AT ALL TIMES.

“5-Mr. Wilsons claim that the territory was “never repurchased” is FALSE, it was repurchased FOR MORE THAN 6 TIMES THE ORIGINAL AGREED UPON AMOUNT, so that the Wilsons could then operate unencumbered. But, and before the ink could dry, Mr. Wilson filed his lawsuit anyway.

“6-The Wilsons HAPPILY operated as a Best Blinds for over 5 months prior to filing their lawsuit.

“7-Mr. Wlson had numerous conversations with the territory owners during contract negotiations with Best Blinds, and after they became franchisees, right up until they filed their lawsuit.

“8-The Wilsons were party to another business distributorship involvement with family members of theirs within months of contacting Best Blinds, which they only participated in for a few months and from which they received a rather large settlement.

“9-I filed bankruptcy because there was NO money left after buying out the original territory owner for more than 6x what the original oral agreement with them was, and paying the attorney fees from 8 months of negotating with their ever changing and unreasonable demands. We were a very new company just getting launched and just did not have the capital to withstand the lawsuit. I certainly did not enjoy filing bankruptcy, or derive any pleasure from it, or ANY part of this litigation. It cost me a business that I had worked years to build.

“10-This is not a game for me. Once the judgement was awarded in the first case, Mr. Wilson thru his attorney filed a proceeding against me personally asking me to bring to court ANY AND ALL of my personal possessions, including my wedding rings, silver, etc. It was evident that things were going to go from bad to worse, and that the Wilsons would be relentless in collection efforts, and would go as far as trying to take our personal belongings., cars and home.

“11-Prior to court, we entered into settlement discussions on numerous occassions with the Wilsons and their attorney, and it was clear that they wanted $200k+, which we did not have to give. Offers of payments over time were referred to by their attorney as a ‘pig in the poke’.

“12-I NEVER knowingly ‘double sold’ any territories. The ONE Mr. Wilson refers to is one of the older dealer training agreements where (bad) copies of maps were used and drawn onto with territory lines. The maps overlapped in a small area, and was NEVER discovered OR brought up in ANY capacity until the Wilson’s needed it to use in their lawsuit. It was merely a mistake.

“13-There are many happy people who bought into our dealer group, and then signed on to our new franchise program, who still are in the window covering business because of the Best Blinds training and support. Some of whom have been damaged because of the unneccesary dismantling of the Best Blinds Franchise program.

“14-The Wilsons changed their name, but still operate a window covering company, which is in direct competition with my retail operation.

“This IS what is wrong with our country today…LITIGOUS PEOPLE costing our courts time and our small company’s their businesses.

“The reason the Wilsons lost their adversary proceeding in Federal Bankruptcy Court is because there was NO FRAUD. I appreciate that our courts protect individuals from relentless and unreasonable creditors who would rather you live in the street if you do not pay them what they demand.”

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BEST BLINDS Franchise Complaints

Best Blinds… Worst Franchise?

Best Blinds franchise owners Eric & Laurie Wilson certainly think so. They bought a Best Blinds franchise then found out the franchisor Laura Melissa Wall-McMahel had already sold the exclusive territory rights to someone else… and never bought back the rights as promised.

The Best Blinds franchisees sued. When the court ruled in the franchisee’s favor, the blind company franchisor tried to get out of paying the judgement by declaring bankruptcy. See court record excerpt below.

Have you had experience with the Best Blinds franchise or ? Share your experience by leaving a comment below.

From Leagle:

ERIC WILSON and LAURIE WILSON, Plaintiffs,
v.
LAURA MELISSA WALL-MCMAHEL, Defendant.

Case No. 09-05754-8-JRL, Adversary Proceeding No. 09-00231-8-JRL.

United States Bankruptcy Court, E.D. North Carolina, Raleigh Division.

July 22, 2010.
ORDER GRANTING PARTIAL SUMMARY JUDGMENT

J. RICH LEONARD, Bankruptcy Judge

This matter came before the court on cross-motions for summary judgment. On June 28, 2010, the court conducted a hearing on the matter in Raleigh, North Carolina.
JURISDICTION AND PROCEDURE

This court has jurisdiction over the parties and the subject matter of this proceeding pursuant to 28 U.S.C. §§ 151, 157, and 1334, and the General Order of Reference entered by the United States District Court for the Eastern District of North Carolina on August 3, 1984. This is a core proceeding within the meaning of 28 U.S.C. § 157(b)(2), which this court may hear and determine.
UNDISPUTED FACTS

1. The defendant is the owner of a window dressing business known as Best Blinds. Best Blinds began operations in 1997. Before 2007, the defendant entered into business training agreements with third parties. Such agreements allowed third parties to conduct business as distributors of Best Blinds’ products in exclusive distribution areas.

2. In January 2005, Thomas Christopher Lawing (“Lawing”) and Brandy Hindes (“Hindes”) entered into a business training agreement with the defendant encompassing Johnston, Franklin, and Granville counties.

3. Early in 2007, the defendant formed Best Blinds Franchising, Inc. for the purpose of selling Best Blinds franchises and converting existing distributors to franchisees. Though Lawing and Hindes were given the opportunity to participate in the franchise program they were not required to do so.

4. In March 2007, Lawing, as a distributor, visited the plaintiff’s home with the intent of selling window blinds. While there, the plaintiffs inquired about franchise opportunities with the Best Blinds company. Lawing referred the plaintiffs to the defendant.

5. The plaintiffs contacted the defendant and expressed their interest in becoming franchisees for certain counties including Franklin and Granville. The defendant informed the plaintiffs that Lawing and Hindes already had exclusive rights in those counties, but thought they would be willing to sell their interest.

6. The defendant was aware that in accordance with the January 2005 business training agreement, a written release from Lawing and Hindes was required before the plaintiffs could conduct business in the subject counties.

7. Lawing and Hindes negotiated with the defendant that they would release Franklin and Granville counties for a sales price of $10,000.00. The parties came to a verbal agreement that instead of paying $10,000.00 outright, the amount would be credited against monies owing to the defendant.

8. In July 2007, the defendant mailed a release to Lawing and Hindes along with a franchise agreement. The release was intended to memorialize the verbal agreement. Neither Lawing or Hines signed the release.

9. On August 12, 2007, the defendant presented the plaintiffs with a franchise agreement granting them the exclusive right to operate a Best Blinds franchise in Person, Granville, Vance, Franklin, and Warren counties. The plaintiffs paid a sum of $50,437.11 for the franchise agreement. At the time the plaintiffs executed the franchise agreement, the defendant was aware that the requisite release had not been obtained.

10. On August 30, 2007, the male plaintiff received a call from Lawing who communicated that neither he nor Hindes had signed the release. After receiving the call, the male plaintiff contacted the defendant who assured him the problem was being resolved. The defendant advised the plaintiffs to continue business as usual. Over the course of the following months, the defendant continually reassured the plaintiffs in this manner.

11. On December 10, 2007, having failed to obtain the release, the defendant offered the plaintiffs an option to rescind the franchise agreement. The plaintiffs accepted the offer on December 26, 2007. A termination agreement was drafted by an attorney for the defendant, which included a non-competition clause and obligation for payment of termination fees. On January 18, 2008, the plaintiffs informed the defendant that the proposed termination agreement did not comport with the terms the parties discussed.

12. On February 28, 2008, the plaintiffs initiated an action in the Superior Court for Vance County against Best Blinds Franchising, Inc. and the defendant.

13. On March 20, 2009, a judgment was entered against the defendant. The court found that the defendant committed an act of unfair and deceptive trade practice. Damages were awarded in the amount of $48,787.11, and were ordered trebled in accordance with N.C.G.S. § 75-16.

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