TL;DR
A Delaware bankruptcy court sided against Applebee's parent company, Dine Brands Global, in its dispute over franchise contracts with RMH Franchise Holdings. The court ruled that Dine Brands did not provide clear notice of terminating its franchise agreement with RMH prior to its bankruptcy filing.
A Delaware bankruptcy court has sided against Applebee’s parent company, Dine Brands Global, in its efforts to take control of 160 units owned by RMH Franchise Holdings, who filed for bankruptcy protection in May.
According to Restaurant Business Online, Dine Brands argued that RMH Franchise Holdings franchise agreement had already been effectively terminated by then, but a judge ruled that Applebee’s corporate parent didn’t provide the required “clear and unambiguous notice” that it was terminating its franchise agreement with RMH prior to its bankruptcy filing
RMH Franchise Holdings, the 1,900-unit restaurant chain’s second-largest franchisee, can now use the units to appease creditors by either selling or shutting them. The franchisee currently owes Applebee’s International Inc. $14.2 million in royalty fees and advertising costs, the article noted.
In this story
This story was originally published in 1851 Franchise on September 27, 2018. Burnaze summarizes and links to the original reporting.
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