What the case involved: Marks & Sokolov lawyers acting on behalf of franchisee obtained an arbitration award invalidating franchising contracts and awarding recovery of lump-sum franchise fee, royalties and other payments previously paid to franchisor
Process and Result: Marks&Sokolov lawyers represented franchisee (“Claimant”) in an arbitration against the franchisor (“Defendant”) of a famous US fast-food chain.
Claimant paid a lump-sum franchise fee, and within a long period of time regularly paid royalties and advertising fees. Defendant breached its obligations to ensure registration of franchise contracts with Russian patent office and to provide Claimant with IP rights under the contracts.
Marks & Sokolov lawyers managed to prove that the contracts were null and void because Defendant failed to register. Marks & Sokolov lawyers also defeated all allegations of Defendant that IP rights had in fact been provided to Claimant and proved unjust enrichment on the part of Defendant in the amount of lump-sum franchise fee, royalties and advertising fund fees.
The tribunal ruled in full favor of Claimant: found the contracts null and void and ordered Defendant to return to Claimant the full amount of what had been paid under the contracts (over $120,000).
Sergey Sokolov and Grigory Galkin served as lead trial counsel.
The Court of Arbitration for Resolution of Economic Disputes at the Russian CCI