“Eight former Cornwell tool dealers, including David Bachrach, sued Cornwell Quality Tools Company for compensatory and punitive damages, alleging common law deceptive trade practices, violation of Ohio’s Business Opportunity Law, fraud, fraud in the inducement, consumer fraud, negligent misrepresentation, and breach of fiduciary duty.
“The plaintiffs (eight former Cornwell tool dealers) have alleged that:
(1) Cornwell’s trade practice is to draw the plaintiffs and others into Cornwell’s sham enterprise;
(2) in the sale of a business opportunity to plaintiffs and others, Cornwell has not acted in conformity with the Business Opportunity Laws of Ohio;
(3) Cornwell committed fraud and fraud in the inducement in obtaining the franchise agreements from plaintiffs and others through material misrepresentations designed to greatly distort the risk involved in the franchise;
(4) Cornwell committed consumer fraud in connection with the sale of services; (5) Cornwell negligently misrepresented facts regarding the likelihood of success of the franchise to the damage of plaintiffs and others;
(6) Cornwell breached its fiduciary duty to its franchisees; and
(7) Cornwell acted with reckless disregard of its franchisees’ rights and well being. All of these claims stem from the formation of the contract and the contractual relationship whereby plaintiffs became franchisees of Cornwell. “
Source: Bachrach v. Cornwell Quality Tool Co., (Ohio 2011)
The court determined that the matter was to be settled via private arbitration – so the proceedings and outcome may never be made public.
ARE YOU FAMILIAR WITH THE CORNWELL TOOLS DEALER FRANCHISE OPPORTUNITY? IS IT A GREAT FRANCHISE OPPORTUNITY, A FRANCHISE SCAM OR NEITHER? PLEASE SHARE YOUR OPINION BELOW.
Contact the author or site admin at UnhappyFranchisee[at]gmail.com.
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have been a dealer for almost 3 years and with the economy as bad as it is i was sent a letter saying cornwell is pulling my franchise because i do not purchas enough tools ......i am below 80% of the national adverage........
sandralboy, come over to MATCO, MATCO is #1 again!
why is it that no one has gone after all of the tool companys togather? they call it a franchise yet they forget the #1 rule in a franchise is that what you do to 1 franchisee you have to do to all not just make up rules as you go along and that it doesn't matter what state the host is in the laws of the state the franchisee is in trumps ......so check out your state laws you will find out they are not treating you right......
i just got the boot from cornwell tools after almost 3 years because my purchase adverage was bellow 80% of the national adverage....mind you 6 of the 12 dealers in this area were also under the adverage....and 4 dealers went down this last year 3 quit i got the boot ...what does that tell you about the management and so called support that the company tells you we are here for you ....well its all lies ....
after the week at tool school most district managers are to spend 2 weeks with you and then ride with you untill you have 75 coustomers ...i got 4.5 days spread out over 2 weeks .....yet i signed the paperwork that said he spent 2 weeks training with me ..i was told it was paperwork i was suposed to sign in ohio...so yes i signed it without reading it ......big mistake on my part......read everything....never trust anything they tell you no matter how much you think why would they lie ....just think of that last used car salesman you heard about and you won't be far from the truth.....
i could go on and on about the things that i went threw in the last 3 years.....and have 3 other dealers to back it up they quit because of what they were told about how much you can make in this buisness ...what they dont tell you is what ever area you get onto if there are any other tool dealers you may have 2 to 3 other tool companys all trying to get the same guys to buy from them....and if you have alot of dealerships most of the techs already have most of their tools and don't buy much and when it is slow and the guys only get paid when they work they don't buy tools....or if they do you don't get paid ......
just a few things to think about before you dive head first into the tool buisness.....
I would call marks & Klein in red bank nj. Look them up on the web. They help people that got screwed with tool companies. It is worth the call. Have dealers and old dealers you know call too...
Was a dealer in 2005 was told that all of Cornhell tools are made right here in Ohio. That was 1 of the reasons I bought in to the b.s. and that my brothers high school friend (district manager) said it was easy money. (U can always trust a high school friend.) My sale pitch was, " made right here in the good ole USA and about 50 miles away keeping the money locally". Until a potential customer showed a wrench that had CHINA embossed on the back. Most wrenches and sockets are made in Ohio but a majority are out of the country. Despite paying myself $400 a week and not being able to collect a lot debt the DM said ,"YOU'RE MAKING MONEY".
I lost about $37000 in one year and got out. Customers who were established were reluctant to buy because they never expected you to be around for six months, because that was how long the previous dealer lasted. (Even though that particular territory never had a dealer so I was told).
There are so many things that Cornwell does to cover themselves that just screws the potential dealer. False statements and all.
Did I mention my brother started 6 months before me. He lasted i think a little over 5 years . Because of Cornhell he lost around 350,000 which included a 60000 401k and my parents house that was paid of at one time . Would love to get some of that back .
Call a franchise attorney if you feel the tool company screwed you. I recommend marks & Klein red bank nj. I think they practice in most states.. Call...
Just in case someone thinks Cornwell is ANY better than any other Tool Franchise think again: In 2008 they started with 584 Franchises and added 127 Franchises through the year but by years end they only had 536 Franchises left.
In 2009 they started with 536 added 121 but only had 532 at the end of the year.
In 2010 they started with 532 added 113 but only grew to 538 by the end of the year.
2008=30% Churn
2009=23% Churn
2010=20% Churn
Try and explain how this is unprofitable for Franchisor’s?
well does anyone know anyone othet than Marks and Klein in redbank nj i called them and they are so burried in Mac, Snapon ,and Matco they don.t want to take on anymoretool dealer cases so if anyone has some info on another attorney please let me know....
i just don't understand why none of the former dealers don't get togather and stop this madness....we loose our buisness our saveings in some cases our homes and its all ok because we do nothing about it ...i think its time to send cornwell a message ......
sandrailboy:
You should get in touch with the Mobile Tool Dealers Association
http://www.mobiletooldealersassociation.com/live/contact-us/
They are organizing dealers from all 4 tool dealer companies, since the complaints are so similar... and there's strength in numbers.
Cornwell has probably got the highest failure rate of all of them. Why aren't there more on here complaining?
Had the same DM as Sal and his brother and I actually warrented a lot of the tools they sold, Cornwell ioesn't tell you you have to buy the freeking tool, give it a customer who broke theirs and then wait 2-4 months to get reimbursed.
I lost about $60000 and before the depression hit, I was collecting $5000 per week and had 30k plus on the street. I lost 175 customers (all who owed me money) in 6 weeks... Cornwell just buried their head in sand and stood there with there hand out lookiing for their money, offering no freeking help whatsoever....... never buy a freeking tool truck