Against whom were the class action lawsuits described in the Even Hotels FDD initially filed?
Even_Hotels Franchise · 2025 FDDAnswer from 2025 FDD Document
Holiday, SCH, and the IHG Owner's Association were named defendants in seven class action lawsuits filed in 2021 by putative classes of Holiday licensees in Connecticut, Louisiana, New Jersey, New Mexico, Ohio, Pennsylvania and Texas. Each of the lawsuits allege that Holiday and SCH engaged in unlawful and otherwise improper franchise business practices, including, imposing unreasonable products, services and requirements and receiving improper kickbacks from required purchases. Specifically, the lawsuits assert causes of action including breach of contract, breach of the implied covenant of good faith and fair dealing, breach of fiduciary duty, declaratory judgment, violation of the Sherman Act, and a demand for an accounting. The New Jersey and Pennsylvania class action lawsuits have since been dismissed. Neither Holiday nor SCH paid any amounts in connection with the dismissal of these class action lawsuits. The five lawsuits that remain are:
Source: Item 3 — LITIGATION (FDD pages 15–26)
What This Means (2025 FDD)
According to the 2025 FDD, seven class action lawsuits were filed in 2021 against Holiday, SCH, and the IHG Owner's Association. These lawsuits were initiated by putative classes of Holiday licensees across multiple states, including Connecticut, Louisiana, New Jersey, New Mexico, Ohio, Pennsylvania, and Texas. The lawsuits alleged unlawful and improper franchise business practices.
The core allegations in these lawsuits centered on Holiday and SCH imposing unreasonable requirements for products and services and receiving improper kickbacks from required purchases. The franchisees claimed this conduct constituted breach of contract, breach of the implied covenant of good faith and fair dealing, breach of fiduciary duty, and violation of the Sherman Act, among other causes of action. The plaintiffs also sought an accounting of the financial transactions in question.
It's important to note that some of these initial lawsuits have since been dismissed. Specifically, the class action lawsuits in New Jersey and Pennsylvania were dismissed, and neither Holiday nor SCH made any payments in connection with these dismissals. The remaining five lawsuits are ongoing in various district courts, with the cases being transferred to the Northern District of Georgia.