What was the outcome of Gary A. King's bankruptcy filing on the Management Recruiters International, Inc. case?
Management_Recruiters Franchise · 2024 FDDAnswer from 2024 FDD Document
ll of which have concluded:
Management Recruiters International, Inc. v. Management Recruiters of Tampa-North, Inc., Gary A. King, and Kelly King, Docket No. V 1627-T-33JSS, filed July 15, 2020 in the United States District Court Middle District of Florida, Tampa Division alleging breach of contract for failure to pay royalties and national advertising fund fees, breach of a Promissory Note, breach of the in-term covenant not to compete, trademark infringement, and tortious interference with contract against Kelly King. Management Recruiters International, Inc. sought declaratory judgment stating that the franchisee had violated the franchise agreement and promissory note, and sought an injunction to cease unlawful competition, lost future royalties and advertising fees, damages for infringement of the MRI trademarks, damages for breach of contract, costs, and attorneys' fees.
On July 30, 2020, Gary A. King filed a voluntary petition for relief under Chapter 7 of the US Bankruptcy Code. Pursuant to 11 USC §362(a) the Court stayed the case pending the outcome of the bankruptcy. MRI objected to the stay as to the other defendants, Kelly A. King and Management Recruiters of Tampa-North, Inc. On August 24, 2020, the Court stayed and administratively closed the matter in its entirety pending the outcome of Gary A. King's bankruptcy proceedings. Gary A. King's debts were discharged in bankruptcy and the matter closed on March 4, 2021.
On May 3, 2021, the remaining Parties, MRI and Kelly A. King and Management Recruiters of Tampa-North, Inc. entered into a settlement wherein the Defendants made payment of $6,500 to MRI and the lawsuit w
Source: Item 3 — LITIGATION (FDD pages 12–14)
What This Means (2024 FDD)
According to Management Recruiters' 2024 Franchise Disclosure Document, Management Recruiters International, Inc. filed a lawsuit against Management Recruiters of Tampa-North, Inc., Gary A. King, and Kelly King on July 15, 2020, alleging breach of contract, breach of a Promissory Note, breach of the in-term covenant not to compete, trademark infringement, and tortious interference with contract against Kelly King. The company sought a declaratory judgment, an injunction, lost future royalties and advertising fees, damages for infringement of the MRI trademarks, damages for breach of contract, costs, and attorneys' fees.
On July 30, 2020, Gary A. King filed for bankruptcy under Chapter 7 of the US Bankruptcy Code, which resulted in the court staying the case pending the bankruptcy outcome. While Management Recruiters objected to the stay regarding the other defendants, the court stayed the entire matter on August 24, 2020. Gary A. King's debts were discharged in bankruptcy, and the matter was closed on March 4, 2021.
Subsequently, on May 3, 2021, Management Recruiters and the remaining parties, Kelly A. King and Management Recruiters of Tampa-North, Inc., reached a settlement. The defendants paid $6,500 to Management Recruiters, and the lawsuit was dismissed on May 6, 2021. This indicates that while the bankruptcy of Gary A. King initially halted the legal proceedings, the case was later resolved through a settlement with the other defendants.