Successfully Represented Major Dessert Chain in Lawsuit Brought by Franchisee Seeking Compensatory Damages [Seoul Central District Court, Sep. 11, 2019]
2019.09.11.
Yuchon represented Sulbing, a major Korean dessert chain, in a lawsuit initiated by its franchisee seeking compensatory damages alleging that it was misled into executing the initial franchise contract because Sulbing provided false and exaggerated expected revenue estimates. The court dismissed all claims by the franchisee.
Yulchon successfully argued before the court that the expected revenue estimates were not false or exaggerated based on a detailed data analysis and that the damages allegedly suffered by franchisee could not be linked to the information provided by Sulbing.
The outcome is significant in that Sulbing is currently facing similar lawsuits as well as Korea Fair Trade Commission (the "KFTC") complaints brought by multiple franchisees alleging the provision of false or exaggerated information. This victory is expected to have a positive impact on these related pending proceedings.
Relatedly, Yulchon's Antitrust Group successfully defended Sulbing in other KFTC complaint proceedings, where the KFTC issued a simple warning against the franchisor. Favorable outcomes in both the civil and administrative proceedings, such as these, involving related disputes, are the result of an effective inter-disciplinary collaboration between Yulchon's Antitrust Group and Litigation Group.
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