On what date did the parties settle the dispute related to the terminated Circle K franchise agreement?
Circle_K Franchise · 2025 FDDAnswer from 2025 FDD Document
GATION**
TMC Franchise Corporation v. Broadway Restaurants, Inc., Zuri Barnes, Case No. 21STCV 19544 (Los Angeles County Sup. Ct.). On September 13, 2019, TMC terminated for cause the Circle K franchise agreement with Broadway Restaurants, Inc. ("BRI"), after BRI failed to cure its defaults under the franchise agreement, following several opportunities to cure provided by TMC. Following the termination, TMC made multiple attempts to contact BRI to cause BRI to comply with its post-termination obligations. When such attempts proved unsuccessful, on May 25, 2021, TMC filed this action against BRI and Zuri Barnes,
BRI's guarantor under the terminated franchise agreement (collectively with BRI, the "Defendant"), due to the Defendant's failure to comply with its post-termination obligations under its terminated franchise agreement, including failure to de-identify the Circle K store operated under the franchise agreement and failure to pay liquidated damages as required under the franchise agreement. TMC sought damages of $61,444 as well as recovery of attorneys' costs and fees. Defendant filed a cross-complaint on September 17, 2021, seeking damages in excess of $5,000,000 and alleging that TMC failed to comply with its obligations under the Circle K franchise agreement, including failing to advertise Defendant's Circle K store, engaging in price fixing, and failing to deposit rebates to Defendant, which actions the Defendant further alleged constituted a breach of the implied covenant of good faith and fair dealing, and unfair business practices under California Business & Professions Code section 17200. TMC disputed all material allegations against it and that Defendant was entitled to any purported damages Promptly after the filing of the cross-complaint, TMC filed a demurrer requesting the court to dismiss the cross-complaint in its entirety, as well as a motion to strike portions of the cross-complaint, including the damages requested, as contrary to well-established California law. The Court granted the demurrer in part and limited Defendant's right to claim damages. The parties settled the dispute on December 29, 2022, pursuant to which settlement Defendant paid TMC $30,722, and the parties entered into mutual releases of liability and filed a stipulation of dismissal, with prejudice, of the
Source: Item 3 — LITIGATION (FDD pages 17–20)
What This Means (2025 FDD)
According to Circle K's 2025 Franchise Disclosure Document, one instance of dispute settlement related to a terminated franchise agreement occurred on December 29, 2022. This dispute involved TMC Franchise Corporation and Broadway Restaurants, Inc., along with Zuri Barnes, the guarantor. The dispute arose after TMC terminated the Circle K franchise agreement with Broadway Restaurants, Inc. due to uncured defaults.
The lawsuit was initiated because Broadway Restaurants, Inc. allegedly failed to fulfill its post-termination obligations, such as de-identifying the Circle K store and paying liquidated damages. TMC sought $61,444 in damages, along with attorney's fees and costs. Broadway Restaurants, Inc. filed a cross-complaint seeking damages exceeding $5,000,000, alleging that TMC failed to comply with its obligations under the Circle K franchise agreement, including failing to advertise the store, engaging in price fixing, and failing to deposit rebates.
Ultimately, the parties settled the dispute, with Broadway Restaurants, Inc. paying TMC $30,722. Both parties then entered into mutual releases of liability and filed a stipulation of dismissal with prejudice, effectively ending the lawsuit. This resolution indicates the potential for disputes and litigation in the Circle K franchise system and highlights the importance of understanding the terms of the franchise agreement and post-termination obligations.