U.S. Tim Hortons franchisees sue RBI

A group of U.S. Tim Hortons franchisees filed a lawsuit Tuesday alleging their parent company engaged in price gouging and equity theft.

Restaurant Brands International “established a very aggressive and improper investment strategy in the Tim Hortons franchisee system, which resulted in the economic squeezing of Tim Hortons franchisees by RBI,” reads the suit filed in the Eleventh Judicial Circuit of Florida court on behalf of the American chapter of the Great White North Franchisee Association.

None of the allegations have been proven in court and RBI disputes the allegations.

The U.S. GWNFA group, which says it represents about half of all American Tim Hortons franchisees, claims RBI and Tim Hortons USA strip them of income and profit through increased and improper franchisee fees.

RBI raised the prices of necessary products and services — like food supplies, paper cups, containers and cleaning supplies — that franchisees must purchase from approved vendors, according to the suit. These prices are “significantly above” open market prices, the suit alleges.

Tim Hortons franchisees pay $104.08 more per case of Applewood bacon than Wendy’s franchisees do, according to the court documents, and $23.85 more for boxes of diet and regular Coke.

It also claims the company requires franchisees who want to sell their stores to first offer it to the company for the five-year declining depreciated value of the furniture, fixtures and equipment.