CUPPY’S COFFEE: An Interview With Franchisee David Morgan is sponsor-supported. Sponsored links:

David Morgan, a disabled Vietnam veteran and a former policeman, and his wife Lisa dreamed of owning a business in Pensacola to help fund their retirement years.  After researching on the Internet and visiting their home office, they cashed in an annuity and gave Elite Manufacturing a $37,500 refundable deposit toward a Cuppy’s Coffee franchise.  They were told that in the highly unlikely event their funding did not come through, their downpayment would be returned to them.  Unfortunately, their dream of cafe ownership turned into a nightmare as Elite failed to secure them financing, and has refused to return their $37,500 or even return their calls.  The Morgans have been told that their money is gone.

UF:  What’s your background, David? What were you doing prior to getting involved with Cuppy’s Coffee?

David:  I am a Vietnam veteran working part time as a substitute teacher. A car accident ended my career as a police officer, leaving me 100% disabled. Prior to that, I was in restaurant management. My wife works for a local company.

UF:  When did you decide you wanted to own your own business? Describe the process you went through to determine which franchise to buy.

David:  My wife and I thought it would be a good retirement investment. We looked at several possibilities, made some phone calls, and Cuppy’s sounded like the best one.

UF:  What did you find appealing about this type of business?

David:  Coffee shops were going up all over our city and seemed to be doing very well. There is no Cuppy’s in Pensacola, so we thought it would be nice to bring in something new and different.

UF:  How did you first hear about your specific franchise? What attracted you to the company?

David:  We found the company through a franchise website on the Internet. It was a local company and the people you talked with made it sound like a new, but fast growing business.

UF:  Describe the company’s sales process and your interaction prior to becoming a franchisee/ depositor

David:  In the beginning, they couldn’t have been more helpful. We went to Ft Walton Beach and were given a tour of the business and everyone was so upbeat and excited about us being there. We were told that they had a “special” going on with Elite and if we gave them $37,500.00 before the end of October, we would not have to pay the franchise fee. We asked what would happen if we couldn’t be financed and were told that the contract we would be signing had a clause that stated we would get our money back if financing was a problem. We went through their pre-approval for a loan and were told that we would have no problem getting a loan. So we gave them the money.

UF:  What marketing and promotional guidance, programs & support were provided? Were they effective? Why or why not?

David:  We were told that once we gave them the money, we would be contacted by every department within the company. We were not. When we asked why no one was calling, we were told that they would not be in contact with us until after we got our financing, which never happened.

UF:  When did things start to go wrong? What was it that made you an unhappy franchisee?

David:  Things started going wrong the minute we couldn’t get the financing. Every time we called to talk to them, they were unavailable. We would leave messages or e-mail them. Occasionally, we would get a response, but it would just be another lie.

UF:  Have you tried to resolve your issues with the franchisor? What was the outcome?

David:  I have been trying to resolve the issue since January 2008. I sent in all the requested paper to prove that I had done everything possible to get financed and failed. I talked to Danny Jones and at first he was trying to say I couldn’t get my money back. After many heated phone calls, he said the company did not have the money, but if I signed a contract, they would pay me back in installments for 3 years. I consulted an attorney and was told that I should sign it. In doing so, I was not allowed to discuss the matter with anyone. I am 100% disabled and cashed in an insurance annuity to give them the down payment so I felt like I had no choice if I wanted to get my money back. The payments were to begin on May 1st. On or around May 15th I received a payment. There was no payment in June, but I did get one in July. I have not received any payments since then and all my calls and e-mails are being ignored. They were the ones to breech the contract on the very first payment, it was late. Since we needed the money back, we played their game hoping for our refund. This didn’t happen. At this time, I have sent in complaints to several government agencies that are investigating the company.

UF:  What is your current situation? What would you like to see happen at this point?

David:  My family and I are not doing very well financially. We are struggling every month to pay the bills. I would like for the company to admit their wrong doings and give back the money that they owe to myself and the other people that trusted them.

UF:  Do you think that the franchise concept is a viable? Under what conditions?

David:  I think that if you do a lot of research and have money to invest without putting yourself in financial trouble, there are some companies out there that are worth the investment. Cuppy’s Coffee is not one of them.

UF:  What were the positive aspects of your experience?

David:  There were NO positive aspects.

UF:  What mistakes did you make? Looking back, what would you have done differently?

David:  I guess believing in people was our first mistake. They made you feel like “part of the family” until they got your money. After that, nothing mattered to them. It didn’t matter if you called and told them you are losing your home or filing bankruptcy, they ignored your calls or e-mails. If they did answer, you were told another lie. I never thought to look on the Internet and research the company. I had no idea that I was not the only one that had thousands of dollars taken from them by this company.

UF:  How has your franchise investment decision affected your life?

David:  As I said earlier, I am 100% disabled and I gave these people my life savings to start a business. I have no desire or the funding to try to start another business.

UF:  What advice would you give to prospective franchise owners? What questions should they ask? What warning signs should they look for?

David:  Do a lot of research. Just because a company can flash a trophy from some place like the AAFD, doesn’t make it a good company. Don’t let them pressure you into giving them any money up front. Take your time. If it is a legitimate company, they’ll wait.

UF:  Thanks for sharing your story

David:  Thank you. is sponsor-supported. Sponsored links:



14 thoughts on “CUPPY’S COFFEE: An Interview With Franchisee David Morgan

  • October 6, 2008 at 9:08 pm

    david, contact John Adams of Broad & Cassel in Destin he can advise you and help you. Also contact emmanuel sheppard and condon, they know they’re stuff and can help you. both might work for contingency also.

  • October 9, 2008 at 5:28 pm

    I’ve found out from a former member of the ” Alabama Scheme Team,” errrrrrrrrr I mean “Alabama Dream Team,” that Dale Nabors was paying certain employees at Cuppy’s Coffee to blog Robert Morgan. He was having them blog Robert Morgan with vicious lies to make him look really bad with any and all franchisees. This was being done by Dale Nabors before he ever stole Cuppy’s. That’s right people…STOLE. He wanted to come riding in on a white horese in shinning armour. He hasn’t paid anything for Cuppy’s, just a “song and a dance.” THIS IS A BONAFIDE FACT! Another fact that I found out is…Dale is on these blogs daily defending himself as other people. THIS IS A BONAFIDE FACT! I know that Robert Morgan is no angel by any means, but next to Dale Nabors…Robert is Gabriel coming down from Heaven in all his Glory! Robert Morgan never stole a penny from anyone. He might have borrowed from Peter to pay Paul, but never did he steal or lie or committ FRAUD like Dale Nabors did. Now Mr. Admin, I know that you have given Dale Nabors the benefit of the doubts a number of times on here and tried to put everything on Mr. Morgan, but you were wrong. PERIOD THE END! What I am telling you now is Dale knowingly and deliberately committed outright FRAUD and he is going jail because of it. Morg never sent out BOGUS invoices to the SBA and the banks. Dale Nabors did and people now have definitive proof that this FRAUD took place numerous times. This has now gone from the Attorney General’s Office in Florida to the Inspector General’s Office and they are ON IT! This will take a little time but it’s now in the system. Franchisee’s keep your eyes open, because justice will prevail. And if you can believe it, Dale Nabors is still telling the same people he told 3 months ago…”It will be next week, and I will have the money.” He will never get any money because everyone now knows what a SPINELESS, COWARD, THEIF, this sorry excuse of a man he really is… If you talk to Dale Nabors long enough you will see that he’s not real bright. If you were to stuff his brain up a humming bird’s ass, it would be like a peanut rollng around in a boxcar.

  • October 9, 2008 at 7:28 pm

    Dale Nabors was paying certain employees at Cuppy’s Coffee to blog Robert Morgan.
    Here I am doing it for free. I feel stupid as a peanut in a boxcar. Or something.
    …next to Dale Nabors…Robert is Gabriel coming down from Heaven in all his Glory! Robert Morgan never stole a penny from anyone. He might have borrowed from Peter to pay Paul, but never did he steal or lie or committ FRAUD…
    Mick: the term is “ROB Peter to pay Paul” or, in this case, “rob Peter to pay Morg.” The word “borrow” means that the money will be paid back. Peter did not get paid back in this case… not after an obligatory payment or two.
    Wasn’t Morg taking money from people and not giving it back when it was Java Jo’z? Was Dale to blame for that? No, that’s right, it was Snowden’s fault.
    What about all the people whose deposits were taken and misappropriated before Dale took over the company? Isn’t taking money for one purpose – like a deposit – then spending it on other things – like a Jaguar, Harley, or condo – fraud? What’s your definition of fraud? Ask Criston Menz, Robin Rivera and the others whose bank accounts were emptied because of Morg’s promises whether they would characterize it as “borrowing to pay Paul.”
    There’s another term for borrowing without an owners permission, isn’t there?
    Now Mr. Admin, I know that you have given Dale Nabors the benefit of the doubts a number of times…
    Not intentionally. I don’t think Dale (or whoever was slandering me in Dale’s defense) would agree. I simply believe that Dale showed up later with the idea of capitalizing on the situation once the pirate ship ran aground (Hey! Free company!). That doesn’t change the fact that Capt. Morgan built the ship, launched it, laid waste to bank accounts near and far, ran it aground and fled… leaving the cabin boy in charge. This is not an either-or situation. They’re both culpable.

    I do believe that Morg is much more masterful at it than Dale, if that’s any consolation. Your hero is good at what he does – there’s no doubt about that.

    If you were to stuff his brain up a humming bird’s ass, it would be like a peanut rollng around in a boxcar.
    You sound way to knowledgeable about inserting things into the business end of hummingbirds, Mick. Gotta say… that’s a little creepy.

  • October 10, 2008 at 10:02 pm

    When you read David Morgan’s story, you underrstand that he had NO idea that this kind of thing happens in America. He had trust in the “system” and couldn’t imagine that something like this could happen to him. He was a victim of public policy that supports franchisors and permits them to sell their franchises under contract at any degree of risk, as long as they are compliant with disclosure regulations. He had faith in the AAFD fair contract rating. But, weren’t these people violating federal law by taking these deposits without providing a disclosure Circular, or, like Quiznos, did their Disclosure contract enable them to take refundable deposits based on their ability to secure a loan or a location within a certain time period?

    Were they violating federal law or were they in compliance with federal law and just illegally converted these deposits? Under federal regulatory policy, why are the David Morgans of our country treated as sophisticated investors who do not have to be given disclosure of the actual risk of the investment in a franchise? David had to cash in his disability annuity to get the money for the deposit and was willing to cash out his annuity and go into debt to buy a business that would secure his retirement. He believed all of the hype and hard sell and happy talk of the sellers and had no idea of the great risk he would be taking if he was successful in getting a loan and had built a Cuppy’s. Obviously, he thought there was very little risk at all.

    This is the ugly and dark side of franchising exposed for all to see. The risk of the investment in franchises is deliberately obscured as a matter of public policy and this is why franchisors are not required to disclose unit financial history to new buyers of their franchises. Who, in their right mind, would take this kind of risk if they KNEW the low profitability or lack of profitability of the investment?

    Unfortunately, because franchising is regulated to protect and encourage the franchisors and to allow them to piggy back and churn, somehow Cuppy’s got into great trouble —and look who is paying for the trouble! The franchisor’s cash problems always mean that the franchisees are sacrificed to any cash flow problems of the franchisors.

    Now! It appears that Cuppy’s remains on the SBA Franchise Registry for a quickie guaranteed loan but perhaps there are no banks and lenders who will loan to Cuppy’s franchisees since prospective franchisees like David Morgan have been cheated out of their deposits, and the word is out. But shouldn’t there be some official action by some agency of government —like the FTC or the SBA? Or, is everyone relying on the arbitrators or the courts to sort out this MESS that looks criminal but that is treated as a civil matter under franchise law?

    Dale blames his problems on the negativity and the loss of his his ability to sell new franchises and to raise income to save the system and the lawyers are delighted with all of the litigation. In the end, who will win and who will lose? Will there be any winners at all?

    If franchisors had to disclose the unit performance statistics of their systems and provide more timely information concerning their financial status, especially upon change of ownership, could situations like Cuppy’s be avoided?

  • October 11, 2008 at 8:06 am

    Cuppy’s franchisees are organizing a group to file civil law suits with the help of a well-know FL franchise law firm. There may be people who made deposits and payments to Java Jo’z /Cuppy’s/Elite who have not received refunds or store build outs as contracted. Seeing a suit through trial is an expensive matter for an individual and so organizing a group to distribute legal costs makes it more affordable. Cost per individual will decrease as more people join the group. We are asking people who are interested in learning more to contact the Admin at with permission to forward your contact information (name, address, email). You do not have to disclose anything other than contact information if you do not want to.

  • November 7, 2008 at 7:31 pm

    I have the same story as everyone else . My story could be the same just change my name to the statements. My story started with a Frank Seeker who played a good role into getting me involved in the business. He talked about all those involved being Godly men and would work to help me get started in business. Like everyone else I have dealt with Robert Morgan and Danny Jones and was promised i would get my funds returned but we all know the story very we. ll have paid them $39,0000 to date and have invested money in a lease for a site only to have them not come through with the promise, Many names can be put to the list of FRAUD Java Joz , Cuppy’s , Elite , Emerald Coast , Medina, and we all know those names involved like a Who’s Who’s list of liars and frauds. I have contacted the BBB of Florida to report the dealings and they tried to contact the company with no luck. I want to encourage those who have lost money like I have that there is a rule higher than those that these people are hiding behind. That rule is God Almighty ‘s and there is no place to hide from HIM or HIS form of justice. “Time is on our side”

  • November 12, 2008 at 12:48 am

    Cuppy’s is a Pyramid scheme

    Certainly watching these people perp walked into jail or denied access at the pearly gates would be a nice consolation prize and a welcome sight, but it offers little when you’ve dumped everything you have into the dream of owning your own business. I have read many such stories of people losing their $30k+ deposits because they couldn’t get financing and these scoundrels used their “refundable” deposits on other peoples projects. My brother GOT his financing and they looted him for $81k. He was left with the bills for the construction build-out as well as purchasing all of his equipment AGAIN. So he paid $81k to these crooks and they used his money on other projects, when the time came for his project to be completed, they were all out of money and he was left holding the bag. The bag being a lease for the coffee shop, all the contractor bills and a giant second mortgage and no equipment, and by this time, word was out so no new deposits to steal. It’s a giant pyramid scheme. As long as there are so-called new investors, they can keep it going and the people on top of the pyramid get their shops open, but once it collapses….. So how do you ever become whole again? Like I said, these guys in jail would be a nice consolation prize but it won’t get your money back. My brother barely has enough resources left to purchase second hand equipment and get his doors open. Hopefully he will be successful enough to survive. But what can he and all the others in his situation do when they don’t have the money or time to take these people to court only to watch them file bankruptcy in the end and thereby fleece these people of their last dollar. The other option is to…… what? let it go? just forget about it?.
    These crooks need to go to jail, have every bit of their assets liquidated and split proportionally among the victims. Just my 2 cents worth. I welcome any suggestions

  • November 12, 2008 at 10:13 am

    Jerry your story is exactually right. They have my money and don’t want to give it back. I’m just glad there was a picture of Dale Nabors on the internet so when I go to AL looking for him I know what he looks like. I will not stop until I get my money back.

  • November 12, 2008 at 10:34 am

    Sorry folks, but there are no assets left to attach. Dale has NO assets personally. He doesn’t even own a house (he rents). The only consolation for the fleeced franchisees is the hope that he goes to jail because there will NEVER be any economic recovery.

  • November 12, 2008 at 2:10 pm

    there are thousands of dollars of assets that they moved up there to Alabama….just get your judgment, file the lien, get a writ of execution, and have the sheriff gather and sell the stuff on the courthouse steps, then collect your money….you can sell the chairs, desks, computers, everything really…its a business, nothing is exempt

  • November 12, 2008 at 6:53 pm

    There may be thousands of dollars in assets, but you need to pay to get the judgement. and it’s a gamble. So let’s say you have the money to hire the attorney, you must also have the time. My brother and his wife have separated from Cuppy’s and put up everything they have left, to get their doors open. There’s no way they can hire an attorney and spend the time going after these people. They have to devote 100% to making their coffee shop a success. As it is they are seriously behind the 8-ball. This should be a criminal issue. We pay taxes and part of those taxes go to protecting the citizens from fraud and thievery.

    Hey Mick,

    You used the term BONAFIDE FACT several times. Do you have tangible proof? and if so, are you willing to share it?

    Does anybody know if there is an organized group working on this? There should be a list somewhere of all of the victims and a ledger or some kind of accounting.

  • November 13, 2008 at 3:45 pm

    Bear in mind that to the extent that a judgment is obtained against an entity, one may attach future income streams.

    Therefore, remember to name all defendants against whom a colorable claim may be made. And if appropriate, seek to attach royalty streams and other such revenue.

  • November 13, 2008 at 9:22 pm

    An entity that likely won’t be around much longer. So that leaves the individuals. Are they responsible for the failed entities? Then there’s the OJ argument. Some people act as if they are above the law and they will never accept the judgment, and somehow they can continue their lives often infesting another community and start the same thing over again.
    I misspoke in my earlier post. This is a Ponzi scheme right down to the letter. This should be a criminal matter, and there should be restitution. Bring them all in, seize their assets, ALL OF THEM and make the victims whole again.

    Are there any attorneys out there, that can advise these people?

  • November 14, 2008 at 2:12 pm

    Ironically the first discussions of Java Joz/Cuppy’s were in regard to the issues of piercing the corporate veil.

    It is difficult and normally impossible to do, but in the particular case of this tangled web there may well be a way of going after the assets of other entities and individuals.

    As to law firms, as noted elsewhere my understanding is that Dady & Garner out of Minneapolis as well as Zarco Einhorn Salkowski out of Miami have spoken with groups of affected franchisees.

    Bear in mind that the interests of “depositor” zees, “open” zees, and “SBA $$ stolen” zees may be in conflict, and so a law firm which is representing a particular sub-set of zees may not be able to represent other sub-sets of zees.

    As to the entity not being around much longer, a bankruptcy filing might be the best thing for all parties. But that is a whole different story which has been discussed at some length on, so I would refer you to that discussion.

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