Dunkin' Donuts Franchisees Win Case Against Franchisor

Randolph, Massachusetts-After a three-week jury trial in the U.S. District Court for the District of Massachusetts, on September 20, 2003, a jury comprised of seven individuals returned a verdict in favor of severalDunkin' Donutsfranchisees. Dunkin' Donuts Inc. claimed that franchisee Manoochi Fallah Moghaddam and the other defendants intentionally underreported gross sales, failed to maintain required records and committed tax fraud in the operation of their businesses.

Two weeks before the start of trial, Dunkin' Donuts had dropped all of its claims for monetary damages, as well as its allegations of improper transfer and intentional underreporting of gross sales. However, Dunkin' Donuts, Inc. continued to claim that Mr. Fallah engaged in "massive tax fraud" in the operation of his businesses, by allegedly concealing over $1,000,000.00 in gross sales dating back as far as 1995.

After deliberating for less than two hours, the seven-person jury returned a verdict in favor of Mr. Fallah and the other defendants and against Dunkin' Donuts Inc. -AFA