A group of former Blenz Coffee franchisees is suing the coffee company Black Tusk Trading Co. and company directors Sarah Kate Moen, Brian Noble, Geoffrey Hair and real estate agent Matthew Moadebi for allegedly conspiring to frustrate their attempts to renew leases and sell the businesses.
Plaintiffs Wayne Taylor, Kulvinder Sahdra, Ali Kormi, 0811037 B.C. Ltd., 0820846 B.C. Ltd. and Coast Mountain Coffee Ltd. filed a notice of civil claim in BC Supreme Court on March 10. According to the claim, Taylor owned a Blenz on Seymour Street from May 2008 until September 2013. Sahdra owned his franchise on Maple Street from September 2009 until September 2013, and Kormi owned a coffee shop on Robson Street from May 2008 until April 2013.
The plaintiffs claim Blenz misrepresented that their leases would be renewed after fixed terms, and that they would not have bought the businesses had they known Blenz would refuse to renew their leases.
When Taylor and Sahdra decided to sell, Blenz allegedly frustrated the process by refusing to approve buyers, causing lengthy and costly delays. Moreover, Kormi claims Blenz made it “impossible” to sell the Robson coffee shop because of its refusal to renew the lease, eventually causing “a total loss of his investment” in the business.
In addition, the plaintiffs claim Blenz failed to disclose conflicts of interest because franchisees are required to buy from Black Tusk Trading Co., which is controlled by Blenz directors Moen, Noble and Hair, the claim says.
Black Tusk’s tea products, the lawsuit says, are more expensive than those of other suppliers, but they had “no power to negotiate prices with Black Tusk, or other wholesalers, despite Black Tusk and other mandated suppliers’ prices being higher than similar suppliers of similar products, and despite it being in the best interest of Blenz franchisees, including the plaintiffs, to be able to purchase similar products at lower prices from other suppliers in the free market.”
The plaintiffs seek damages for breach of contract, intentional interference with contractual and economic relations, and misrepresentation. None of the allegations had been proven in court and the defendants had not filed a response by press time.