What was the reason Churchs Chicken sued Carolina Café Services, Inc.?
Churchs_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
ar – Enforcement of Express Contract Terms:*
Cajun Global, LLC v. Carolina Café Services, Inc., Case No. 24CV003456 (Fulton County, Georgia Superior Court). We filed suit against defendant on March 19, 2024. Defendant is a former Church's Chicken franchisee, which ceased operating its franchised restaurant before the end of the franchise agreement term. We brought claims for breach of the franchise agreement, lost royalty damages resulting from the premature closure of the restaurant, and attorneys' fees. On March 6, 2025, by agreement of the parties, the Court entered a Consent Final Judgment finding in favor of us on each of our claims and awarding us damages of $136,000.00, plus pre- and post-judgment i
Source: Item 3 — LITIGATION (FDD pages 14–16)
What This Means (2025 FDD)
According to Churchs Chicken's 2025 Franchise Disclosure Document, Cajun Global, LLC, filed a suit against Carolina Café Services, Inc. on March 19, 2024, because Carolina Café Services, Inc., a former Churchs Chicken franchisee, ceased operating its franchised restaurant before the end of the franchise agreement term. Churchs Chicken brought claims for breach of the franchise agreement and sought lost royalty damages resulting from the premature closure of the restaurant, as well as attorneys' fees.
The court entered a Consent Final Judgment on March 6, 2025, in favor of Churchs Chicken on each of its claims. The judgment awarded Churchs Chicken damages of $136,000.00, plus pre- and post-judgment interest, which terminated the litigation.
This type of litigation, involving a franchisee closing early and the franchisor seeking damages, is relatively common in franchising. Franchise agreements typically have clauses that obligate franchisees to operate for the entire term of the agreement, and early termination can result in significant financial penalties. Prospective Churchs Chicken franchisees should understand that they are entering into a long-term commitment and should carefully consider their ability to fulfill the terms of the franchise agreement.