Terminated franchisee sues Dunkin’ for discrimination

WHITE PLAINS N.Y. An immigrant couple whose four-unit Dunkin’ Donuts franchise was terminated has sued the chain’s franchisor in federal court here for allegedly discriminating against minority franchisees, according to an attorney identified as their legal counsel.

Also named as a defendant was the franchisor of Dunkin’s sister brand, Baskin-Robbins, according to a statement issued on behalf of the plaintiffs, Mahendra Patel and his wife, Nita Patel. Both the Dunkin’ and Baskin-Robbins brands are owned by Dunkin’ Brands Inc., based in Canton, Mass. The specific entities sued by the Patels were Dunkin’ Donuts Franchise Restaurants LLC and Baskin-Robbins Franchise Shops LLC, according to the statement.

The suit alleges that the defendants invent reasons to wrest restaurants away from newly immigrated entrepreneurs, resulting in either the termination of franchises or the forced sale of stores to Dunkin’ Brands or “more sophisticated Caucasian operators,” the statement quotes the filing as saying.

"Dunkin’ Donuts restaurants are owned and operated by more than 1,200 independent business men and women, who represent a variety of racial, religious and ethnic backgrounds," Margie Myers, Dunkni' Brands' senior vice president of communications, said in a statement. "Dunkin’ Donuts only pursues legal action with respect to franchisees who do not adhere to federal and state laws or fail to meet the obligations as required by their franchise contract. With regards to this specific case, we feel confident that the legal action taken against this particular franchisee is appropriate, and we are confident the court will find in favor of Dunkin' Donuts."

The statement issued on behalf of the Patels also asserts that employees of Dunkin’ Donuts Franchise Restaurants try to intimidate franchisees by impersonating investigators from the FBI.

The statement was issued by Gerald A. Marks of Marks & Klein LLP, the Red Bank, N.J., firm identified as representing the Patels.

“By reclaiming desirable locations from small family business oriented franchisees such as the Patels, and then making them available for Caucasian-owned multi-unit franchisees, Dunkin’ believes that it will be able to attract dramatically larger and more sophisticated Caucasian operators,” Marks said.

The action filed by the Patels describes them as “typical” of the mom-and-pop immigrant franchisees that form “the backbone of the Dunkin’ system,” according to the statement.

According to the release, the legal filing notes that “Dunkin’ specifically targets franchisees that are of Indian, Arab and other brown skin descent, because these franchisees are unsophisticated with the American legal system” and other official means of redress. It asserts that Dunkin’ exploits that lack of sophistication.

The units operated by the Patels were located in Goshen, Harriman and Chester, N.Y.