Damon’s Restaurants Inc. sent one of its consultants to check on two franchise restaurants in Arizona last month.
The restaurants had the Damon’s look and menu and the employees wore Damon’s attire, but the restaurants were no longer Damon’s. The franchisee had renamed the dining spots Fahrenheit’s. Damon’s Restaurants, which is Damon’s International Inc.’s franchising subsidiary, is suing Sun Pacific Management LLC and the franchisee’s owners, M. Jamil Akhtar and Joan Akhtar, alleging breach of contract and trademark infringement among other charges.
Sun Pacific has franchise agreements for Damon’s restaurants in Mesa and Gilbert, Ariz. The 10-year agreements, which began in 2002 and 2003, require that the restaurants operate as Damon’s.
The company learned of the name change when trying to collect $23,727 in unpaid royalties and advertising fees. It confirmed the change after sending a consultant to the site June 27.
According to the lawsuit filed three days later in U.S. District Court, the franchisee still was using Damon’s “look and feel,” including table-top speakers with the company logo, the same menu and the company’s trademark and service marks on receipts and kitchen staff clothing.
Damon’s terminated the franchise agreements June 23, which required Sun Pacific to pay Damon’s any money it owed and strip the facilities of Damon’s-related materials.
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