What specific California laws did the Jack Dinh complaint allege Checkersrallys violated?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
e notice to our affected customers. On July 2, 2019, a civil complaint was filed against us on behalf of plaintiff Jack Dinh and similarly situated customers (the "Dinh Complaint" and together with the Cotter Complaint, the "Complaints"). The Dinh Complaint asserted claims of negligence and violations of California Civil Code §§ 1798.80, et seq., and California's Unfair Competition Law, Bus. & Prof. Code §§ 17200 et. seq., stemming from our alleged failure to maintain reasonable security practices to protect the unauthorized access to our customers personal information. The Complaints sought certification of a putative nationwide class of consumers impacted by the alleged breaches and also sought monetary damages, injunctive and equitable relief, attorneys' fees and other costs. We held a joint mediation concerning both Complaints, and subsequently entered into a settlement agreement to dismiss both Complaints with prejudice. On August 25, 2021 the Court entered an Order approving the settlement, which requires us to (i) reimburse each class member up to $5,000 for documented out-of-pocket expenses, or (ii) provide $20 in restaurant vouchers to each class member without documented out-of-pocket expenses. In accordance with that Order, notice of the settlement was subsequent
Source: Item 3 — LITIGATION (FDD pages 15–17)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the civil complaint filed by Jack Dinh alleged that Checkersrallys violated specific California laws. The Dinh Complaint asserted claims of negligence and violations of California Civil Code §§ 1798.80, et seq., and California's Unfair Competition Law, Bus. & Prof. Code §§ 17200 et. seq., stemming from Checkersrallys's alleged failure to maintain reasonable security practices to protect the unauthorized access to customers' personal information. The complaint sought certification of a nationwide class of consumers impacted by the alleged breaches and also sought monetary damages, injunctive and equitable relief, attorneys' fees and other costs.
In this case, the settlement required Checkersrallys to either reimburse each class member up to $5,000 for documented out-of-pocket expenses or provide $20 in restaurant vouchers to each class member without documented out-of-pocket expenses. This indicates that Checkersrallys chose to settle the case rather than continue with litigation.
For a prospective franchisee, this concluded litigation highlights the importance of data security and compliance with state laws regarding consumer data protection. It also demonstrates the potential costs associated with data breaches, including legal fees, settlement payouts, and damage to the brand's reputation. Franchisees should ensure that Checkersrallys has adequate data security measures in place and that they understand their obligations under applicable laws.