STRATUS BUILDING SOLUTIONS Franchise: Guadalupe Clemente’s Horror Story

Unhappy franchisees of janitorial/commercial cleaning franchise companies often share a common complaint.

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They allege that janitorial Master franchisees use deceptive tactics and dirty tricks to keep from providing the cleaning accounts unit franchisees have paid for with their life savings.

Unit franchisees pay these masters thousands of dollars for cleaning contracts with guaranteed minimum revenue.

But if the franchisees are offered jobs which they decline, the contract states that the masters have fulfilled their obligations. 

The masters can keep the fees and the unit franchisee gets nothing.

Sometimes the masters offer jobs that are bid so low, the franchisee cannot profitably service them.

Sometimes the masters offer cleaning accounts so geographically distant, the franchisee cannot profitably manage them.

Sometimes jobs that have been accepted and are being successfully cleaned by the unit are taken away by the masters to give to another franchisee, and then another, a practice called “churning.”

In either of these scenarios, the unit franchisees have lost their franchise investments and have no cleaning jobs, and no cleaning revenue.

According to a class action lawsuit filed in Missouri Circuit Court against Stratus Building Solutions, Ms. Markeeta Rivera (STRATUS BUILDING SOLUTIONS: Markeeta Rivera’s Franchise Horror Story) and Ms. Guadalupe Clemente were two of many victims of these deceptive tactics perpetrated by Stratus Building Solutions and its master franchisees.

Ms. Guadalupe Clemente’s story below is an excerpt from the lawsuit Markeeta Rivera And Guadalupe, Plaintiffs -vs- Simpatico, Inc, And Stratus Franchising, LLC, Defendants. 

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GUADALUPE CLEMENTE’S STORY

79. The story of Guadalupe Clemente is even more outrageous and a perfect example as to how the system developed by Simpatico has been used to blatantly take advantage of the Unit Franchisees.

80. Ms. Clemente discovered Stratus Building Solutions in a magazine called Segundo Mano. There were advertisements in Spanish concerning Stratus. The advertisements make no reference to the existence of the Master Franchisee and direct the reader to the Stratus website. (See Advertisements attached hereto as Exhibit “17”).

81. Stratus also advertised on radio station 105.9 in Phoenix, Arizona.

82. Ms. Clemente speaks little English, but Stratus provided a salesperson who spoke Spanish.

83. Ultimately, Plaintiff decided to purchase a Stratus franchise at the level which would generate revenue of $36,000.00 per year or $3,000.00 per month.

84. Plaintiff asked how long it would take to generate the revenue and was told it would occur immediately after she completed her training.

85. In order to pay for her franchise, Ms. Clemente had to sell her car.

86. She delivered a check for her franchise fee on April 4, 2011, signed her Franchise Agreement with PHSCCH SBS, LLC, doing business as Stratus Building Solutions of Metro Phoenix, the Master Franchisee, and completed her training. (A copy of the Franchise Agreement is attached hereto as Exhibit “17”)

87. Based on the representations made to her, she expected to be offered accounts by mid-April.

88. She was offered her first account on April 28, 2011. However, the account was too far away and would not have given her the profit she needed to make it feasible to accept the account.

89. When she refused the account, Stratus had her execute a form entitled “Non Acceptance of Account.” (See Exhibit “18”)

90. Plaintiff was not offered another account until September of 2011.

91. Prior to visiting the account, Plaintiff contacted a woman named “Martha” who had gone through training with her.

92. Martha informed Plaintiff that she had only been given three accounts and that they had just taken one of the accounts away.

93. Further discussion revealed that the account being offered to Plaintiff was the account that had been taken away from Martha.

94. Plaintiff visited the account but felt bad that it was the account taken away from Martha.

95. Plaintiff was not willing to participate in the “churning” of accounts.

96. Plaintiff informed Stratus that she did not want any part of the system and asked for her money back.

97. Instead of getting a refund, Plaintiff received a letter informing her that her rejection of the account in April fulfilled Stratus’ obligations under the contract. (A copy of the letter is attached hereto as Exhibit “19”)

98. The letter further admitted that since Stratus only offered her accounts with total monthly revenue of $1,500.00 within the time prescribed in the Franchise Agreement, she would be entitled to a refund of the difference in the value of the franchise plans.  However, since Stratus alleged she did not make full payment, they gave her no

refund.

99. Plaintiff has had to borrow money to purchase a vehicle and she has never been given sufficient accounts to be profitable.

100. Plaintiff lost all of her savings as a result of the fraudulent actions of Stratus.

Read all related stories here:  Stratus Building Solutions Franchise

Read and comment here:  STRATUS BUILDING SOLUTIONS Franchise Complaints

STRATUS BUILDING SOLUTIONS FRANCHISE OPPORTUNITY:  WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

To contact the author or site admin, email UnhappyFranchisee[at]gmail.com

STRATUS BUILDING SOLUTIONS: Markeeta Rivera’s Franchise Horror Story

Many contend that commercial cleaning / janitorial franchise opportunities like those offered by Stratus Building Solutions, Coverall and Jan-Pro are blatant scams.

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The text of a recent lawsuit filed in the Circuit Court of the County of St. Louis, State of Missouri, against Stratus Building Solutions contains the horror stories of two alleged franchise scam victims, Markeeta Rivera And Guadalupe Clemente.

Both alleged victims are women.

Both are Hispanic.

Both were allegedly tricked out of their savings by a cold and calculated technique that has been used and refined by janitorial franchise sales sharks for decades.

Here is an excerpt from the actual lawsuit document:

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MARKEETA RIVERA’S STORY

70. In April of 2010, Plaintiff Rivera entered into an amended “Unit Franchise Agreement” with Impressive Cleaning Solutions, Inc., doing business as Stratus of Upstate New York. (A copy of that franchise agreement is attached hereto as Exhibit “15”.)

71. Pursuant to the FDD, Plaintiff purchased a franchise plan that was to provide her projected gross annual revenue in the amount of $30,000.00.

72. Pursuant to the Unit Franchise Agreement, if the Franchisor fails to offer accounts that satisfy the projected revenue within 120 days of the execution of the Agreement, Franchisor is required to refund a pro rata portion of the initial franchise fees.

73. However, Franchisor’s obligation to refund any portion of the initial franchise fee is deemed waived if the Unit Franchisee rejects any customer accounts offered by Franchisor or subsequently discontinues service to any customer accounts offered by Franchisor.

74. Plaintiff was offered accounts that required Plaintiff to travel such distances that it was economically not feasible to accept the account.

75. Under the terms of the Franchise Agreement, Franchisor could offer an account hundreds of miles away from the Unit Franchisee that Franchisor knows the Unit Franchisee will reject to relieve the Franchisor of its obligations under the contract. Such actions have occurred throughout the United States.

76. Plaintiff has never been provided accounts which total the projected annual revenues in that amount, had accounts taken from her without just cause or excuse, had excessive and/or unauthorized fees assessed against her, and has never been able to attain the business level represented to her by the Master Franchisee.

77. That the Master Franchise engaged in the practice of “Churning.”

78. That the above-referenced fraudulent actions set forth by Plaintiff, were first undertaken by the Defendants who passed their practices, policies, procedures, and methods to the Master Franchisee to utilize.

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Also read:

STRATUS BUILDING SOLUTIONS Franchise Lawsuits Ahead?

STRATUS BUILDING SOLUTIONS: Markeeta Rivera’s Franchise Horror Story

Read all related stories here:  Stratus Building Solutions Franchise

STRATUS BUILDING SOLUTIONS FRANCHISE OPPORTUNITY:  WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

To contact the author or site admin, email UnhappyFranchisee[at]gmail.com

STRATUS BUILDING SOLUTIONS Franchise Lawsuits Ahead?

Attorney Jonathan Fortman filed suit in Missouri yesterday seeking certification of a nationwide class of all Stratus Building Solutions unit franchisees who have agreements with the master franchisees.

Fortman’s petition to the court on behalf of Stratus franchisees Markeeta Rivera and Guadalupe Clemente (and those similarly situated) does not seek monetary compensation.   According to Fortman, “We are simply asking the court to declare that under Missouri law, the Stratus Master Franchisees are captive agents of Stratus (based on Stratus’ level of control) and not independent contractors.”

Fortman says “We are also asking the court to declare that Stratus Building Solutions and its franchising company have conspired to defraud both the master and the unit franchisees into purchasing into a system they knew, based on their experience in St. Louis, could not be sustained.”

The Stratus Master Franchise Agreements require that the agreement be interpreted under Missouri law.  If the Missouri judge rules in Fortman’s favor, he will be well-positioned to file group action lawsuits throughout the country on behalf of Stratus Building Solutions franchise owners.

The lawsuit includes the sad stories of the Plaintiffs, two Hispanic women who lost their savings through the alleged “churning” and other deceptive practices of the Stratus Building Solutions franchise sales machine.  As soon as they are posted, you can read their stories here:

STRATUS BUILDING SOLUTIONS: Markeeta Rivera’s Franchise Horror Story

STRATUS BUILDING SOLUTIONS Franchise: Guadalupe Clemente’s Horror Story

Read all related stories here:  Stratus Building Solutions Franchise

STRATUS BUILDING SOLUTIONS FRANCHISE OPPORTUNITY:  WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

To contact the author or site admin, email UnhappyFranchisee[at]gmail.com

MATCO TOOLS: Franchisee Alleges Franchise Fraud (Video)

Matco Tools has posted numerous video franchisee testimonials on YouTube extolling the benefits of the Matco Tools franchise opportunity.

However, the latest franchisee videos have been unflatteriong, to say the least.

Debbie Solko is a current Matco Tools franchisee who is fighting for survival on a sparsely populated route in the Rocky Mountains.

Solko (the self-named “Lady Matco”) has posted her second video claiming that she is the victim of a fraudulent franchise investment scheme that sets up its distributors to fail.

Her video (entitled “Matco tools franchise FRAUD”) begins:

“Hi.  My name is Debbie Solko and I’m a Matco Tools distributor.

“I’ve been a Matco Tools distributor for the past two and a half years… soon to be ‘former’ tool distributor.

“I am the victim of franchise fraud and let me tell you why…”

Solko claims that Matco Tools was contractually obligated to provide her with 325 viable, potential customers as part of her franchise agreement.

According to Solko, Matco  Tools is also contractually obligated to resupply viable, potential to make up for attrition, shop closures, and layoffs.

In her video, she claims that Matco Tools has failed to fulfill either obligation… and now she is in danger of having her franchise terminated by Matco.

Watch her short video:

Debbie “Lady Matco” Solko’s first video is posted here:  MATCO TOOLS: Lady Matco Speaks Out (Video)

Matco Tools Franchise Posts & Discussions

MATCO TOOLS Franchise Complaints  June 8, 2011 (3000+ comments)

MATCO TOOLS Franchise Defenders Speak Out December 7, 2011 (Comments defending Matco invited)

MATCO TOOLS Distributor Franchise December 7, 2011 (Overview with links)

MATCO TOOLS Franchise Report Alleges Distributor Churning  November 29, 2011

MATCO TOOLS 2011 Franchise Disclosure Document (FDD) & Other Resources  November 22, 2011

MATCO TOOLS Class Action Lawsuit, “Secret” Sales Projections  November 22, 2011

FRANCHISE LAWSUIT Alleges Matco Tools Scam, TD Bank Fraud  November 15, 2011

Failure Rates of the 10 Most Popular Franchises  April 26, 2010

 

ARE YOU FAMILIAR WITH THE MATCO TOOLS FRANCHISE DISTRIBUTOR PROGRAM? WHAT DO YOU THINK? SHARE A COMMENT BELOW!

To contact the author and site admin, email UnhappyFranchisee[at]gmail.com

JAN-PRO: Is JAN-PRO Franchise a Scam?

Have you had any experience with the Jan-Pro franchise (or similar company)?  Please share a comment below.

 
Jan-Pro is a commercial cleaning company that claims to be Entrepreneur magazine’s #1 Fastest Growing Franchise in 2008 & 2009. According to Entrepreneur, there are currently more than 8100 Jan-Pro franchises in the U.S.  The franchise investment ranges from $3,300 to $54,300.

 
According to the Jan-Pro website, “The JAN-PRO® Franchise System is structured around the Master Franchise Concept. This concept takes advantage of a decentralized structure where each Master Franchise Owner acts as the Regional Franchisor in their exclusive market.”

 
So, Jan-Pro “Master” franchisees sell “Unit” franchises and support the “Unit” franchisees in their territories.  “Unit Franchisees” do the actual cleaning of buildings, and are supplied with cleaning jobs from their Master.  According to JAN-PRO “Unit franchisees are assigned their first customers once they have completed training. JAN-PRO® staff will be there to provide assistance every step of the way, designing a complete work schedule and teaching how to complete each task in a proper and timely manner.”

 
According to the JAN-PRO® website:

 

When you become a Unit Franchisee with JAN-PRO, you will enjoy:

-  Support from your regional master franchise office.

-  A steady income stream. You’ll receive monthly income from the customers provided to you by your master franchise owner, without the expense of an accounting system and the worry of collecting the receivables.

-  The benefits of a recognized name. According to 2008 Entrepreneur Magazine, the #1 Fastest Growing Franchise overall.  Most building owners and managers prefer working with a larger company that has a good reputation, excellent references, and professional customer support and service.

-  Professional relations. Quality control, customer account inspections and customer support are provided by our specially trained technicians.

-  Unlimited growth potential. Additional customer accounts will be provided to build your business at a pace that meets your need

However, messages left by commenters alleging to be JAN-PRO unit franchisees claim that JAN-PRO Master Franchisees failed to provide the required cleaning jobs, and then refused to honor their guarantees.

 
Recently, Tryingtomake it wrote on ComplaintsBoard.com:

I purchased a franchise with Jan Pro in Northern New Jersey. I’ve been with them for almost a year. My husband had to go there and threaten them to get the first account. I had to hound them for months to get the second one. They keep giving me accounts where the people are pissed off and it takes us months to get them where we want them. They still have to give me one more account and I will hound them until they do.

 
By the way did I mention that even after you get all your account you will sill not make enough money because you WILL have to pay someone to help with the cleaning since they seem to bid extremely low so by the time you finish paying the royalty fees and your employees, you don’t have any money left to even buy yourself a soda. Personally I think its a scam. They most probably charge more to the client that what they led us to believe.

 
I have no one to blame but myself for not fully researching this before buying into it. Oh well live and learn. For anyone out there thinking on doing business with the Jan Pro in Northern New Jersey. Think twice. One lady took the manager and pinned him to the wall (she got her money back)

krussi wrote:

we purchased a franchise a little over one year ago. We received accounts from another franchisee as you state for people who are not happy. They are suppose to fill the franchise within 120 days according to our franchise agreement or return the franchise fee. After one year we only were half full.

We decided to enforce the 120 days and gave them notice, they say they offered us enough to fill the franchise, it our word against theirs, they will not return our franchise fee. As you stated the only way to make any money is to clean them all yourself. I too think this is a scam. They did not fill our accounts but we find out that the guy taking our accounts just bought his franchise two months ago; they cannot fill ours but take someone elses money.

Has anyone else out there taken them to Court and won? There was a case in 2004 Guzman vs. Jan Pro. I spoke with Guzman’s lawyer, I wish I would have researched more fully as well because Mr. Guzman had the same issues and he won. His lawyer told me to get out as fast as you can… I will pursue getting my money back, this is fraud.

WHAT DO YOU THINK? IS JAN-PRO A SCAM? DO EXPERIENCES VARY BY MASTER FRANCHISE TERRITORY? SHARE A COMMENT BELOW.

This post was originally published April 19, 2009.  Some comments were lossed due to computer error.  If you with to contact site admin, email UnhappyFranchisee[at]gmail.com.

N LYNN on April 26th, 2009 5:09 pm wrote:

We have an account we no longer wish to service – it doesn’t pay enough for all the work required.

We gave them notice that we would no longer be working that account, but they say we can’t quit it until they find someone to fill it. I don’t think they are trying very hard.

I don’t see anything about timeframes on our paperwork – how long do you think we are obligated to work this account?

guest on April 28th, 2009 11:20 am wrote:

I’m thinking about getting into this business. Can anyone comment on how well they are doing?

michael on April 29th, 2009 11:12 pm wrote:

if you need help let me know i can help i was hands on for so called jan pro

READ MORE ON JAN_PRO:

JAN-PRO Franchise Complaints  August 11, 2009

JAN-PRO: Janitorial Franchise Warning  October 14, 2009

JAN-PRO UnhappyFranchisee.com Responds to Jan-Pro Threat  December 27, 2011

JAN-PRO Threatens UnhappyFranchisee.com  December 27, 2011

Commercial Cleaning Franchises: 10 Reasons to NOT Buy One  February 25, 2010

FTC’s Janitorial Franchise Buyer’s Guide  October 14, 2009

JAN-PRO UnhappyFranchisee.com Responds to Jan-Pro Threat

Commercial cleaning franchise company Jan-Pro Franchising International sent a threatening email to UnhappyFranchisee.com.

(See JAN-PRO Threatens UnhappyFranchisee.com)

The letter, sent from Jan-Pro attorney Kathryn B. Shipe, alleged that UnhappyFranchisee.com was infringing of Jan-Pro’s registered trademark.

UnhappyFranchisee.com’s response follows:

12/27/11

Ms. Shipe:

Thanks for your “courtesy letter” regarding the single 240 x 120 pixel Jan-Pro logo that appeared on a single blog post on UnhappyFranchisee.com….

In regard to your objection to the use of the Jan-Pro logo on the UnhappyFranchisee.com website, please be advised that:

1. The right for bloggers and online publishers to use company logos is clearly protected under the Fair Use Doctrine.
2. The logo appeared on a blog post titled “JAN-PRO Franchise Complaints” that was accompanied by 600+ mostly negative comments about the Jan-Pro franchise program. If ever there were ever an “unlikelihood” of confusion, this would be it.
3. This logo was provided by Jan-Pro’s own public relations agency for use in online and print publication. Your client provides this logo publicly in a downloadable format in order to encourage its use by writers, publishers and bloggers.

Even though continued use of the Jan-Pro logo on UnhappyFranchisee.com is fully within our rights under the Fair Use Doctrine, as a courtesy we have taken the following steps:

1. We have replaced the offending logo with a graphic that states “We are NOT JAN-PRO”
2. We have placed the “We are NOT JAN-PRO” graphic in several key places on our website, including our home page.
3. We have published a prominent post that includes both your Cease & Desist Courtesy Letter as well as further clarification that UnhappyFranchisee.com is not affiliated with your client, JAN-PRO.
4. We will publish this response letter as well, to ensure that no likelihood of confusion between UnhappyFranchisee.com and your client could possibly exist.
5. We invite your client, JAN-PRO, to provide a statement, clarification, rebuttal or rebuttals to any and all of the views expressed by individual commenters on UnhappyFranchisee.com. We will publish your client’s rebuttal and clarification with the same or greater prominence as the views of the contains the individual commenters (whose views are not that of UnhappyFranchisee.com). Please extend this offer to your client on our behalf.

On a more philosophical note, it seems likely that an experienced attorney such as yourself would know that fair use of the Jan-Pro logo is entirely within our rights. We must assume that either 1) you believed that we are not aware of the legalities regarding freedom of speech on the Internet and thought we could be bullied, or 2) you were making contact as a first step for some further legal purpose.

Please be assured, in either event, that we are knowledgeable, resolute and outspoken when it comes to protecting the right to free speech, open discourse and transparency on the Internet. While we believe it is the right of each franchisee to share their experiences and their opinions, we also believe each franchisor has the right to dispute, rebut or disprove those opinions. We look forward to continuing to provide an open forum for both franchisees and franchisors, and hope your client will take us up on the invitation to participate in our forum.

ADMIN

UnhappyFranchisee.com

Statements or rebuttals are welcome and can be submitted to UnhappyFranchisee[at]gmail.com.

ARE YOU FAMILIAR WITH JAN-PRO FRANCHISING INTERNATIONAL?  FEEL FREE TO SHARE A COMMENT BELOW.

JAN-PRO Threatens UnhappyFranchisee.com

JAN-PRO Threatens UnhappyFranchisee.com

Read more

THE JANITORIAL AGENCY Scam or No Scam?

The Janitorial Agency aka TJA aka (and formerly GMS Contracts) advertises what it calls a Master Franchise opportunity.

The Janitorial Agency website states:

“Own your own exclusive franchise.  We’re looking for a select group of entrepreneurs or business professionals who hold themselves to higher standards and desire to run their own janitorial agency master franchise with all the assistance and support that is needed to maintain the high levels of success. As an exclusive Master Franchise owner, you will have the freedom to run your own Janitorial Agency master franchise, with the proven model of success, and be rewarded for managing a high performance business. We help you do all of this without all of the hassles brought upon most business owners. You have your own business and you’re not growing it alone.”

The Janitorial Agency Complaints

Despite the friendly tone and assurances of The Janitorial Agency website,  a growing number of complaints and scam allegations are appearing on complaint sites throughout the Internet.

October 17, 2011, babalu wrote:

TJA Company [The Janitorial Agency] is a total scam. I have purchased they program for $7400.00 and they said it is  GUARANTEED business volume of $24000.00. If you get your contract, if you are lucky they will charge 20 % on your first contract. And willl say that $7400.00 was for setup package.

They send you to bogus appointments and then claim that it’s your fault for not obtaining the contracts. The client will tell them, they dont need a cleaning company…

Please save yourself from these company…

Mike d — STOCKTON California U.S.A. – posted this on July 28, 2011:

GMS Contracts/The Janitorial Agency Promised leads of quality janitorial accounts, never called once, Internet

A sales rep from GMS Contracts called me a few years back to sign up with them. She said for 840.00 she would be able to help us get contracts by setting up the appointments. After a year I never received one call. I called to ask for a refund, at this point they were changing their name to The Janitorial Agency. I spoke with Steve I think was his name and he said if they could locate the old records (whatever) that they would refund me…….imagine this, they didn’t locate them..

After trying many times to get a refund they said they would apply the money I was owed towards their new program that cost way more…….?! huh really? So now to get my refund they want even more of my hard earned cash…shut these crooks down….it has been many months since i last spoke with anyone

I looked up this board today after I got an automated call from them wanting me to sign up…the nerve…

April 23, 2011, Rose Gerard — Valley Stream New York, wrote:

The Janitorial Agency TJA Total Scam, Unable to deliver Lansing, Michigan

This company is a total scam. They do not have the contracts to give you and they don’t issue refunds if they fail to perform. They send you to bogus appointments and then claim that it’s your fault for not obtaining the contracts. A lot of the prospects are not looking for cleaning services and the so called “training and consulting” is something you can do yourself for less than $100 at the JanitorialStore. They can’t help you grow your business because they can’t run a business themselves. Look them up on the Michigan Better Business Bureau and the Michigan Attorney General. They have a lot of unresolved complaints. Look out for Sue Bowers and Denise Shattuck, they send them to talk to you when you file a complaint. They try to get you to retract your complaints so that they can screw you over. Google the name TJA scam and TJA complaints. There are over 30 complaints about them. Sue Bowers visit sites and try to write rebuttals when people try to complaint. It is not an issue of training and doing your part, they can’t deliver and want to keep your money as well

RickR wrote:

Terrible.  These guys are terrible. All I can do is beg people not to waste their money here. Imagine a sleezy car salesman, mixed with a con-artist, combine that with a serial liar, and you still wont come close to how low this company will stoop to get your money.

ARE YOU FAMILIAR WITH THE JANITORIAL AGENCY OR GMA CONTRACTS?  IS THE JANITORIAL AGENCY A GREAT OPPORTUNITY OR A SCAM?  SHARE A COMMENT BELOW.

Contact the author or site admin at UnhappyFranchisee[at]gmail.com.

STRATUS BUILDING SOLUTIONS Franchise: Are Stratus Franchisees Successful?

The Stratus Building Solutions franchise, like other commercial cleaning & janitorial franchises,  is under fire from its franchisees.

Our post STRATUS BUILDING SOLUTIONS Franchise Complaints prompted some harsh criticism.

Stratus Franchisee wrote: “…[Stratus] franchisees are offered accounts that are not profitable. When they are forced to give them up because they lose money, the franchisor transfers the account to another new unsuspecting franchisee… It seems the business is not set up to find new profitable accounts but to find new gullible franchisees because that is how the franchisor can make a quick buck.”

Linda Seneway wrote “I am a former employee at Stratus Building Solutions. I left because I could no longer be a part of scamming minorities. The contracts are set up against you. You cannot win and will never make money.”

SUCKER wrote: “THEY UNDER BID YOUR JOBS AND TAKE 30% OF THE CHECK…THEY LOW BALL TO GET JOBS…”

Nunya wrote:  “Stratus Building Solutions is a scam……period!!!!!! They jack up the price on any and all equipment….uniform attire that one would use… they double that price when it gets to the Franchisee.”

Jonathan Fortman wrote:  “…I filed a class action lawsuit in the Circuit Court of the City of St. Louis on behalf of 3 plaintiffs who purchased Stratus franchises. The franchisees allege that Stratus gave them false and misleading information to get the to sign the franchise agreement, failed to provide services it agreed to provide in the franchise agreement and violated Missouri law by terminating franchises without proper notice.”

Stratus Building Solutions Responds to Criticism

How does Stratus Building Solutions respond to such damning allegations about its commercial cleaning franchise opportunity?

A blog named Franchise Chatter recently acknowledged online criticisms from janitorial franchisees.

Franchise Chatter posed the question “Are Stratus Building Solutions unit level franchisees financially successful?”  Stratus Building Solutions Marketing Coordinator Marisa Lather provided an official company response, which is reprinted in its entirety below. Italicized commentary is UnhappyFranchisee.com ’s.

Are Stratus Building Solutions unit franchisees successful? “What an outstanding question…”

Are Stratus Building Solutions unit level franchisees financially successful? Marisa Lather replies:  “What an outstanding question and one to definitely take into consideration. I can only speak for Stratus Building Solutions. It all goes back to creating a system built for success with appropriate margins for every participant. Every Stratus system has been built with the unit franchisee in mind.”

Yes, Marisa, it is an outstanding question!  We have fielded numerous complaints that Stratus underbids jobs and provides franchisees with contracts that yield less than minimum wage. Not to be pushy, but we eagerly await your answer to this outstanding question.

Stratus’ Marisa Lather continues:  “The founding philosophy of Stratus Building Solutions is to draw distinction to the company by being a true bottom up organization. The success of the unit franchisee is paramount to the success of the company. Even in building our tagline of ‘Your Success is Our Only Business’ we wanted to convey how truly committed we are to having successful franchisees on all levels, starting with the unit.”

Marisa, we agree.  It’s a beautiful tagline!  We have not received one complaint about the Stratus tagline! 

However, we have received complaints that Stratus Master Franchisees will take away accounts from unit-level franchisees under the pretense that there were client complaints (when there weren’t) so they can award them to new franchisees at a much higher profit. I’m sure you’ll address this when you answer the outstanding question. Which will be soon, I hope!

Marisa states:  “Every product, system and process has been carefully evaluated to see how it will influence the outcome of the unit franchisee’s investment. For example, we are the only company in our industry to have our own line of Green Seal Certified cleaning chemicals. When we were exploring the idea, we went to our developer and stressed it must be competitive or superior to anything else available in our market.”

Marisa, how will Green Seal Certified cleaning chemicals help unit level franchisees whose jobs are hopelessly underbid or who have profitable accounts taken from them under false pretenses, as is alleged?  You ARE going to get to the outstanding question soon, right?

Marisa states:  “Our Stratus brand HEPA Filtration Backpack Vacuum is a top grade piece of equipment that costs $450 at retail. Through the Stratus program, unit franchisees are able to have the vacuum at a discounted price while still maintaining top quality.”

Marisa?  Seriously?  People are claiming that they are losing their savings and being scammed out of their livelihoods, and you brag about the discount they get on a vacuum cleaner?  Plus, franchisees contend you double and triple the price of such things as uniforms and business cards to franchisees.  Answer the outstanding question, now, please!

“It’s also worth noting that we have zero litigation (compared to our competitors) and we offer unlimited consultation on what the FDD states so that our prospective franchisees understand exactly what is coming in and going out.”

Zero litigation compared to your competitors?  What does that even mean?  And what about the class action lawsuit reportedly filed against Stratus Building Services on behalf of three stratus unit franchisees?  Have you read STRATUS BUILDING SOLUTIONS Franchise Class Action Lawsuit Filed?

“We’re lucky to have avoided such issues for the most part, but it’s certainly a valid question and it’s best to know all sides of a business — good and bad — when evaluating a final choice. Buying a franchise is more than just an investment in your money – it’s your time, your life really.”

Oh, Marisa, you teased us, then broke our hearts.  You said the question of franchisee profitability was outstanding, and then you dazzled us with your tagline, HEPA vacuum discounts and Green Seal Certified chemicals! And you never answered the outstanding question!

We do agree on one thing:  Buying a Stratus franchise will cost you more than money… so prospective franchisees should thoroughly research this opportunity and get expert advice before buying the franchise.

ARE YOU FAMILIAR WITH THE STRATUS BUILDING SOLUTIONS FRANCHISE OPPORTUNITY?  WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

Contact the author or site admin at UnhappyFranchisee[at]gmail.com.

OXYMAGIC Carpet Cleaning Franchise Sued for Bullying, Bad Faith Dealings

Oxymagic carpet cleaning franchise company, it seems, is earning a reputation as a corporate bully.  Now they’re getting sued for it.

(UnhappyFranchisee.com)  Oxymagic franchise owners might be fine people who take great pride in serving their customers.  Unfortunately, it seems like the OxyMagic carpet cleaning brand that they rely on is becoming more and more associated with the bullying tactics and vendettas of the OxyMagic franchisor.

As we reported in an earlier post (Has OXYMAGIC CEO David Iseley Gone Off the Deep End?), OxyMagic founder & CEO David Iseley maintains a website dedicated to smearing a young, ex-employee he accuses of becoming a competitor.  David Iseley has started a YouTube channel dedicated solely to videos in which he personally attacks the ex-employee (whose carpet cleaning franchise is thriving and has outpaced  OxyMagic in both awards and unit growth).

Now another company is claiming to be a victim of threats and intimidation by Iseley’s OxyMagic… and they’ve filed a lawsuit to put an end to it.

Virtual Point, Inc. Plaintiff, v. Oxymagic Franchise Development, Defendant

On September 14, 2011, Virtual Point Inc., a California Corporation dba Crosspath filed a complaint in United States District Court, Central District of California, against Oxymagic Franchise Development, an Oklahoma corporation.  The complaint seeks declaratory judgements that establish that (despite what Oxymagic Franchise Development accuses) they did not infringe on Oxymagic Franchise Development’s trademark, they did not engage in unfair Competition, they did not violate the Anticybersquatting Consumer Protection Act, and that they are the rightful owner of the Oxymagic.com domain name.

In addition, the complaint alleges that Oxymagic Franchise Development is guilty of Common Law Unfair Competition and has violated Unfair Competition of California Code section 17200.

Virtual Point Inc. is seeking monetary damages, attorney’s fees & expenses.

Read the full complaint:  Virtual Point, Inc. v. Oxymagic Franchise Development (PDF)

Here’s the gist: it seems that, after eight years, the domain name Oxymagic.com recently became available for registration.  Oxymagic missed its chance to register it, and Virtual Point, Inc. registered the domain name for its own use.  According to the Virtual Point, Inc. suit, Oxymagic then launched a campaign of threats and intimidation to try to coerce Virtual Point into giving them the domain.

According to the complaint, a representative for Oxymagic Franchise Development “sent three separate communications, each accusing the Plaintiff of infringing on the Defendant’s trademark rights.  Within these emails the defendant also demanded transfer of the Domain Names and sought Plaintiff’s legal address for legal service of process.”

“…Defendant’s actions and communications show a clear intent to use any means necessary to obtain the Domain Names…”

“Defendant’s accusations of trademark infringement are objectively specious and baseless, and have been made in a bad faith effort to obtain ownership of the Domain Name.”

“At best, Defendant’s trademark rights are weak and narrowly limited…”

Oxymagic was granted a federal registration by the US Patent & Trademark Office last year for the service mark “Oxymagic” in the area of carpet cleaning.  Virtual Point Inc. maintains that it is not using the name to promote carpet cleaning, so the trademark claim is irrelevant.  Further, the suit points out that there are hundreds or thousands of legitimate websites using “oxy” and “magic” in trademarks, domain names and websites owned by third parties promoting such things as wood floor refinishing, a stain removal pen, a face cream, several different cleaning services and a model of refrigerator.

So while the franchise company might be under the impression it owns the word Oxymagic, “At best, Defendant’s trademark rights are weak and narrowly limited to the field of carpet cleaning” according to the complaint.

ARE YOU FAMILIAR WITH OXYMAGIC FRANCHISE DEVELOPMENT, DAVID ISELEY OR VIRTUAL POINT, INC.?  SHARE A COMMENT BELOW.

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