Current and former franchisees denounce Groupe Qualinet and its sole shareholder and president, Mr. Éric Pichette, and are claiming $26,889,000 in damages

MONTRÉAL, March 22, 2016 /CNW Telbec/ - Thirty-two Qualinet franchisees and former franchisees* are jointly suing the franchisor Qualinet and its sole shareholder and President, Éric Pichette, for the major damages they incurred when they joined the banner and fell victim to the franchisor's false statements and systematic breaches and faults.

Highlights of the originating application as expressed by the plaintiffs**




1.


"For the most part, the Franchisees are small investors from various backgrounds with varying levels of experience;




2.


They all joined the Qualinet banner and adopted its concept at a time when the franchise's reputation appeared to be untarnished;




3.


Mr. Pichette's charisma, personality and persuasiveness also played an important role in convincing all of the Franchisees to do business with Qualinet;




4.


More specifically, based on the false and deceitful representations of Qualinet, primarily with its president, Mr. Pichette, the Franchisees were all misled as to, among other things, the existence of agreements between Qualinet and insurers, the Qualinet network's actual maturity and scope and, especially, the financial forecasts that had been submitted to them;




5.


In a style all his own, Mr. Pichette would occasionally dispense sporadic assistance to certain Franchisees in an unfair and irregular fashion;




6.


For example, when some Franchisees complained or tried to organize themselves with other franchisees to voice their complaints, Mr. Pichette would "buy their silence" by offering temporary economic assistance, which never succeeded in mitigating the amateurism, unreliability and lack of organization of Qualinet and Mr. Pichette towards their network of franchisees;




7.


Consequently and owing to these numerous instances of misconduct, several of the Plaintiffs lost all of their initial investment, and some even had to turn to the protection of the Bankruptcy and Insolvency Act;




8.


A majority of Franchisees therefore had to "close up shop" before the duly signed franchise agreements had expired;




9.


Refusing to back down, the Defendants also managed to get some of the Franchisees to sign releases, once again based on deceitful representations;




10.


Due to the fraudulent nature of the remarks made by the Defendants, the signed releases have vitiated their consent and must therefore be declared null and void;




11.


Also, the Franchisees are entitled to claim losses realized over the entire term of the agreements to which they subscribed;




12.


It was only recently, namely in the fall of 2015, when the Franchisees broke their isolation to join ranks and organize themselves, that they became aware (notably following the broadcast of a report) of the scope, seriousness and general nature of the fraudulent conduct and inaccurate remarks made by the Defendants;




13.


As will be demonstrated at the investigation and hearing, the Franchisor engaged in unfair competition against its own franchisees;




14.


In fact, the Franchisor monopolized a majority of the cases in protected territories assigned to the Franchisees, whether they were dry cleaner franchises or disaster clean-up franchises;






[…]




15.


The damages claimed have been assessed by an independent expert using the Defendants' own financial projections that were submitted. These were then projected over the entire term of the relevant agreements;"

 

According to Mtre Frédéric Gilbert, who is representing the plaintiffs, the conduct of Qualinet and its shareholder, Mr. Éric Pichette, is a sad example of an abusive and irresponsible approach.

"The success of the franchise industry's business model hinges on the parties' mutual compliance with the contract binding them. This contract creates obligations for the franchisor and its franchisees. In this case, the evidence demonstrates that Qualinet and its president, Mr. Éric Pichette, disregarded the main obligations, both explicit and implicit, that govern franchise agreements," commented Mtre Frédéric Gilbert, who is representing the 32 plaintiffs.

*24 individuals, 8 legal persons who operate or used to operate 13 franchises.
**The full text of the proceeding is available on request.

 

SOURCE Fasken Matineau

For further information: Michel Fréchette, 514 926-5827; Spokesperson for the plaintiffs: Mtre Frédéric Gilbert, Fasken Martineau, 514 397-5232, cell: 514 262-0930

RELATED LINKS
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