Facts

Yogurtland Franchising Inc. owns the Yogurtland Marks: trademarks, tradenames, service marks, derivations and logos. As part of the franchise, Yogurtland Franchising licensed the right to use the Yogurtland Marks to franchisees for use as part of their businesses. On January 17, 2014, Ramanjit Brar entered into a franchise agreement with Yogurtland Franchising. Six years later, after Brar failed to pay outstanding royalty and marketing fees, Yogurtland Franchising notified Brar that he was in breach of the Franchise Agreement. Notices were again sent the following year twice and the Franchise Agreement was terminated thereafter. However, Brar refused to comply with the post-termination obligations outlined in the Franchise Agreement, for example, failing to remove the Yogurtland trademarks and service marks from the store. On March 29, 2022, Yogurtland Franchising filed suit against Brar.

PLAINTIFF'S CONTENTIONS: Plaintiff contended that defendant materially breached the Franchise Agreement and consequently, it suffered loss, damage and injury, including but not limited to, unpaid royalties and marketing fees, and a loss of future revenue from the recurring fees over what was left of the Franchise Agreement's terms. Plaintiff asserted several claims including federal trademark infringement and false designation of origin, common law trademark infringement and common law unfair competition, unfair competition in violation of California Business and Professions Code Section 17200 and breach of contract.

DEFENDANT'S CONTENTIONS: Defendant denied all contentions.

Result

The parties agreed to settle. Among other confidential settlement terms, Brar agreed to pay Yogurtland Franchising $500,000 as damages, with a discount for timely payments. Also, Brar was permanently enjoined from several actions such as reproducing, counterfeiting, copying the Yogurtland Marks to identify goods or services not authorized by Yogurtland Franchising.