Two separate class actions against Priceline and Hog’s Breath appear to be stumbling over costs.
Class action lawyers Levitt Robinson believe it will require an estimated $8.18 million to take the Priceline case to trial and the New York-based Galactic Litigation Partners which was funding the case has now pulled out.
Franchisees were alleging that Priceline applied a heavy hand that squashed their profitability.
Lawyerly reports that current and former franchisees in New South Wales, Queensland, South Australia and Victoria, allege the franchise agreements were unenforceable and fees unreasonable, with the automatic replenishment of stock through Priceline’s parent company API a form of churning debt.
With funding withdrawn by Galactic, group members of the class action are to seek a discontinuance of the case.
The Hog’s Breath class action, which is seeking damages for unconscionable conduct, has also stalled over money.
The applicants are two directors and the St Mary’s Hogs franchise, and are unfunded. They have been ordered to provide $1.23 million as security for the legal costs in the event the class action is unsuccessful. The money will be held in trust until the ruling.
According to Lawyerly the case is now on hold as Justice Brigitte Markovic ordered the first of four payments, $100,000 to be paid within 30 days of her ruling to the defendants, the franchisor HBCA, and director Ross Worth.
A further $180,000 must be paid to co-defendants CEO Steven Spurgin and directors Matthew Jesse and Alfred Dryland; and the payment of $520,000 to another named defendant, the subsidiary HBC Management.
HBCA has filed its own case against St Mary’s Hogs for alleged unpaid royalties.
