What was the settlement agreement reached between Management Recruiters International, Inc. and Peter Rouillard?
Management_Recruiters Franchise · 2024 FDDAnswer from 2024 FDD Document
s dismissed on May 6, 2021.
Management Recruiters International, Inc. v. Peter Rouillard, et al., Docket No. CV 17 885383, filed December 26, 2017 in the Court of Common Pleas, Cuyahoga County, Ohio alleging breach of contract for failure to pay royalties and national advertising fund fees. On October 22, 2018, Rouillard filed a counterclaim alleging breach of contract/constructive termination, unjust enrichment, fraudulent inducement, and defamation and stated injuries in excess of $25,000 for each count, along with declaratory judgment for unconscionability and liquidated damages.
On September 1, 2019, the parties entered into a written settlement agreement whereby Rouillard agreed to make payment to MRI a sum equal to $75,000, execute a new Franchise Agreement for a term of three years, and make supplemental royalty payments to cover costs of being in an exclusive territory of another member. The parties agreed not to disparage one another, to mutually release one another from all claims known and unknown, and to keep the settlement terms confidential, except as
Source: Item 3 — LITIGATION (FDD pages 12–14)
What This Means (2024 FDD)
According to Management Recruiters' 2024 Franchise Disclosure Document, a settlement agreement was reached between Management Recruiters International, Inc. and Peter Rouillard on September 1, 2019. The lawsuit, initiated on December 26, 2017, involved allegations of breach of contract for failure to pay royalties and national advertising fund fees. Rouillard had filed a counterclaim alleging breach of contract/constructive termination, unjust enrichment, fraudulent inducement, and defamation, seeking damages exceeding $25,000 for each count, along with declaratory judgment for unconscionability and liquidated damages.
As part of the settlement, Rouillard agreed to pay Management Recruiters $75,000. Additionally, Rouillard was required to execute a new Franchise Agreement with a three-year term and make supplemental royalty payments to cover costs associated with operating within another member's exclusive territory.
The settlement also included a mutual agreement between the parties not to disparage one another and to release each other from all known and unknown claims. The terms of the settlement were to remain confidential, except where disclosure was required by law. This type of settlement, involving a monetary payment, a new franchise agreement, and mutual non-disparagement, is fairly typical in franchise litigation to resolve disputes and allow both parties to move forward.