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WIRELESS TOYZ Fraud Case: Franchise Company, Simtob Must Pay; Barbat Cleared

One of several franchisee lawsuits charging Wireless Toyz, and executives Richard Simtob, Joe Barbat, and Jack Barbat with fraud has ended with mixed results.

According to Crain’s Detroit:  “An Oakland County jury awarded $180,600 damages last week against Wireless Toyz and another $20,000 against Richard Simtob, its finance director and vice president of franchise development, in favor of Colorado franchisee David Abbo of Colorado Toyz Inc.

“Jurors awarded no damages against founder and President Joe Barbat, his company JSB Enterprizes Inc. or against co-founder and Vice President Jack Barbat.”

The single count awarded is for silent fraud. The other allegations of pure fraud, negligent misrepresentation and the franchise law violations were dismissed or resulted in no damage awards from the jury.

The plaintiffs in the case were represented by Birmingham-based Norman Yatooma & Associates P.C.  They were seeking $7.2 million in damages.

According to ClickOn Detroit:

Attorney Norman Yatooma also represents Abbo and other investors, who claim they were defrauded out of their investments by Barbat and the company.

"They didn’t much care what the franchisees were ultimately going to earn. What they cared about was getting their $100,000, their $150,000, their $200,000 down payment to open up that store or to reserve that territory. After that, what happened to the franchisee was their problem," Yatooma said.

He said the investors were lied to when they were told they would make huge profits with their franchises.

"[Joe Barbat’s] made obscene millions off this Wireless Toyz scandal. He’s made millions upon millions upon millions," Yatooma said.


5 thoughts on “WIRELESS TOYZ Fraud Case: Franchise Company, Simtob Must Pay; Barbat Cleared

  • annonymous

    A franchise does not want to make a one time profit. They want everyone to success so they can get a royalty.

  • annonymous

    They want everyone to succeed so they can get a royalty

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  • Brandon Ray

    Defendants correctly argue that the evidence adduced at trial established that Plaintiffs were not defrauded or mislead….The Court finds that the evidence shows that Defendants did not conceal the existence, nature, uncertainties or financial effects of the franchise.

  • Fran Davis

    Your right Brandon. In fact, the Court noted that the extra-contractual statements were contradicted by the express disclaimers in the [Franchise Offering Circular], Franchise Agreement, Development Agent Agreement, and Acknowledgements.

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