SACRAMENTO, Calif. — A federal judge has barred a Natomas Wingstop from operating as a Wingstop after its corporate franchise was revoked, according to court documents.
The decision comes after allegations that the former franchise owner violated the terms of a contract with the Dallas-headquartered Wingstop Inc. The company alleges the Natomas franchise owner, Michael Morris, breached the terms of their franchise contract by failing to meet customer service standards, failing to pay royalties on gross sales and for failing to contribute to an advertising fund, court records show.
"We are vigorously defending our brand name and reputation and have filed an action in the California courts to force this unauthorized operator to remove all association with Wingstop to prevent further damage to our brand," a Wingstop spokesperson told ABC10 in a statement.
This all comes after attorneys representing Morris sued Wingstop in November 2019 for at least $1 million in Sacramento County Court following the company’s decision to revoke the franchise.
The suit alleges Wingstop improperly terminated the franchise, refused to deal in good faith, repeatedly increased the cost of goods, supplies, and services so much so that the business no longer became profitable, and interfered with the franchise’s ability to conduct business.
Citing litigation, Morris declined to answer specific questions about the situation, lawsuit and health inspections. However, on Monday, Jan. 2, Morris told ABC10 he plans to correct the violations by Tuesday, Jan. 7.
According to Sacramento County health officials, the restaurant passed a health inspection Tuesday allowing them to continue to operate.
The preliminary injunction was ordered on Jan. 3, 2020, by Chief District Judge Kimberly J. Mueller of the U.S. District Court for the Eastern District of California.
"Wingstop has offered evidence that the customer experience at the former franchisee restaurant falls below acceptable franchise standards, causing patrons of the restaurant to associate Wingstop with poor quality,” Judge Mueller wrote in the preliminary injunction.
Wingstop is a restaurant chain specializing in chicken wings. There are more than 1,100 Wingstop locations in six countries. The company began offering franchises in 1998.
Morris was given 14 days to comply with the order. The franchise was also registered with Morris CM Enterprise, Morris’ Elk Grove-based limited liability corporation.
The store, located at 3541 N. Freeway Boulevard Suite 115, has been operating for more than three months without permission from the Wingstop corporation, according to court documents. The company officially terminated the rights for the Natomas location to operate under the Wingstop name on Oct. 11, 2019.
The Natomas Wingstop location was open for business as of Jan. 6, 2020, when ABC10 visited the restaurant. However, the store is listed as “permanently closed” on Google and Yelp. The location is not currently listed on the Wingstop website.
Customer reviews on Twitter, Google, and Yelp cite poor customer service and unsanitary conditions at the Natomas Wingstop. There were multiple positive online reviews, too.
Sacramento County health officials recently found multiple "major" and repeat violations at the restaurant, according to retail food inspection report conducted on Jan 3, 2020. Violations classified as "major" pose an immediate threat to public health and have the potential to cause food-borne illness, according to the Sacramento County Environmental Management Department.
The restaurant’s major violations included issues at a handwashing station and food that was held at unsafe temperatures, according to the report. Employees at the restaurant were also found to not have their food handlers cards on site, chemicals were stored near ketchup packets, and areas in the kitchen and other parts of the restaurant were found unclean, according to the report.
The restaurant passed a health inspection Tuesday allowing them to continue to operate. The deadline was mandatory to pass by Jan. 7, or the restaurant could have been closed by the county, according to the report.
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