Franchise Times Recounts Cuppy’s Coffee’s “Blog Attacks,” Scoble Incident

Franchise Times Recounts Cuppy’s Coffee’s “Blog Attacks,” Scoble Incident Originally published September 4, 2007 by Sean Kelly on FranchisePick.Com

Remember Java Jo’z & Cuppy’s Coffee?

The September issue of Franchise Times recounts how multiple blogs, including Robert Scoble’s Scobleizer, FranchisePick.Com, BluemauMau.org publicized the problems plaguing prospective franchisees of Java Jo’z (including Scoble’s brother Ben) when they were unable to get their refundable $30,000 deposits returned as promised. Numerous franchisees, unable to find suitable locations on which to drop a pre-fab Java Jo’z drive-up coffee hut, returned to the franchise HQ to see that the sign now said “Cuppy’s Coffee” instead of “Java Jo’z.”

Poor misguided Ben Scoble and the rest couldn’t understand that, despite seeing the same employees in the same offices under the same logo, this was now ”Cuppy’s Coffee,” which didn’t owe them a cent.

The snivelling whiners ended up complaining about losing their savings on the blogosphere, leaving Cuppy’s Coffee no other choice than to hire a firm to awkwardly try to erase all negativism, through trickery, hackery & coercion, it seems, from the blogosphere. It was a grand plan, because, as we all know, bloggers respond very well to trickery, coercion and threats to their freedom of speech.

Attacks from the blogosphere

What Cuppy’s learned the hard way

By Julie Bennett

As published in: Franchise Times – September 2007

Last winter, Doug Hibbing, president of Cuppy’s Coffee and More in Fort Walton Beach, Florida, learned about blogs the hard way.

Hibbing had been working for Roy Snowden, the owner of a coffee licensing concept called Java Jo’z until May 2006, when Snowden was sent off to federal prison for tax evasion. Hibbing and an associate, Robert Morgan, pledged $3 million for the assets of Java Jo’z and for a second company, Medina Enterprises, that equipped the company’s drive-thru coffee stands. By July 2006, they had started a new company, Cuppy’s Coffee, and turned it into a franchise.

According to a UFOC they filed this July, Cuppy’s then spent $189,557 on Internet advertising, promoting their offering as a less expensive option to Starbucks. Leads poured in like latte and by the end of December they’d sold 100 franchises.

“Then at the first of this year,” Hibbing said, “we saw our leads dry up by 80 percent. We had no idea what the problem was until someone asked us about a couple of franchise blog sites. Google led us to blog postings that said Cuppy’s was still being run by the people who had run Java Jo’z and that we had cheated a lot of licensees out of their deposits. We were absolutely blindsided.”

Cuppy’s had, in fact, been run over by the Scobleizer. Robert Scoble, author of “Naked Conversations: How Blogs are Changing the Way Businesses Talk with Customers,” is a technology expert who operates www.scobleizer.com, one of the Web’s most popular blogs. It seems that Robert’s brother, Ben, had paid $30,000 to Java Jo’z, but had never found a location for his drive-thru coffee shop and felt he deserved a refund. When the Cuppy’s executives turned him down, Ben asked his brother for help.

Which was the cyber equivalent of opening the steam valve on an espresso machine. “Many blogs are interconnected,” said Sean Kelly, of IdeaFarm, based in Leola, Pennsylvania, whose own blog, www.franchisepick.com, is interlinked with 200 business-related blogs via the B5 Media Network. So many other blogs picked up the Scobleizer’s account of his brother’s dispute with Cuppy’s that the controversy shot to the top of Internet search engines. If you were a prospective franchisee who Googled Cuppy’s, the first thing you’d find was Scoble’s posting.

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16 Responses to “Franchise Times Recounts Cuppy’s Coffee’s “Blog Attacks,” Scoble Incident”

Paul Steinberg says:
September 6, 2007 at 4:50 pm

The tactics used to intimidate those who spoke out on various websites should remain of concern to all of us. Bloggers have rights, and just because a lawyer threatens to sue you for defamation doesn’t mean you should head for the hills.

On the positive side, don’t believe all those retractions. The pressure of the blogosphere had a lot of beneficial impact, and if you speak one-on-one with those who posted “retractions” you would get a much different story.
sean says:
September 6, 2007 at 6:32 pm

Good points, Paul. As you were one who was at the center of the controversy – and an intended victim of a badly botched slander attempt – what did you think of the article? What do you think of Cuppy’s AAFD award? Have they truly been converted, or was it all PR?
Don Sniegowski says:
September 7, 2007 at 1:57 am

The Franchise Times reported several facts inaccurately in this story and left out important parts of the story. Paul wrote a very good op-ed piece. Paul reminds us all that law firm Nixon Peabody sent a letter to him to attempt to stop him and others from posting on the Internet. And for some reason the FT article left out that Sean Kelly was contacted and bullied by Cuppy’s legal department to remove news postings.

I will post on these inaccuracies later. To give FT some credit though, there were two very insightful quotes in the article. The first hints at what not to do:

‘Hibbing’s next move turned his short problem into a grande one.’

And the golden nugget:

“In the old days,” said Robert Einhorn, an attorney in the Miami office of Zarco Einhorn & Salkowski, “a bad franchisor could keep trucking along, terminating unhappy franchisees and adding new ones. Today, the Internet and blogs shine a spotlight on abusive franchisors. It’s more important than ever for franchisors to address problems early on, before a disgruntled franchisee tells his tale on a blog.”

To their credit, Cuppy’s tried quite hard in the end to show that it was turning a new leaf.
Paul Steinberg says:
September 7, 2007 at 10:38 am

I do believe that Cuppy’s has changed; their business came close to shut-down but Rhonda saved their bacon, and Cuppy’s folks have told me that in hindsight they should have handled the matter differently.

If you read between the lines in the FT article, I don’t think that you see Cuppy’s coming out in support of Dozier’s tactics. I don’t know why Julie Bennett makes it sound like hiring Dozier was a good idea, and hiring Sanderson was an afterthought. Would be interesting to know what Sanderson thought of the article.
Mr. Blue MauMau says:
September 8, 2007 at 8:42 pm

There are several factual errors or misleading statements in the FT article, “Attacks From The Blogosphere: What Cuppy’s learned the hard way.” I’m a pretty nice guy but Blue MauMau has an obligation to our franchisee and wannabees readers to be clear on the facts on articles that we are involved in. So in bold is the original statement in the Franchise Times as written by Ms. Julie Bennett [JB], a contributing journalist, and in plain text is Mr. Blue MauMau’s correction below [Mr. Blue].
[JB] “One franchisee forwarded the letter on to Blue Mau Mau, Franchise Pick and other sites and soon Sully’s private apology was posted all over the Internet.”[Mr. Blue] NOT CORRECT. Actually, an anonymous guest posted an “open letter” in the comments area that was purported to be from iSold It’s Ken Sully addressed to iSold It franchisees on Franchise Pick. The editor of Blue MauMau (me), made the special effort of confirming the authenticity of that letter and interviewing CEO Ken Sully by calling iSold It’s VP of Business Development, David Crocker. I managed to get a few quotes from the company. By the way, the letter was issued several days after Blue MauMau contacted senior executives of iSold It to get a statement on the franchise system’s litigation and cash-flow issues. [JB] “Ben, had paid $30,000 to Java Jo’z, but had never found a location for his drive-thru coffee shop and felt he deserved a refund.”[Mr. Blue] NOT CORRECT. Ben Scoble had more than a feeling that he deserved a refund. Ben was promised, as an ammendment to his agreement, a refund of his deposit by Java Jo’z. See email that shows this. [JB] The U.S. has an estimated 12 million blogs, most of which are operated by individuals who post their personal opinions and vent their frustrations daily. But millions more are industry-specific, like the 900-plus Web sites that are related to franchising.[Mr. Blue] NOT EXACTLY. Not every site on the World Wide Web is a blog. And it cannot be said that “most… are operated by individuals who post their personal opinion AND vent their frustrations daily.” This is incorrect on a number of levels. Most bloggers do not write daily. And they do not necessarily vent their frustrations. For example, when franchise leader, Mr. Bill Marriott, C.E.O. of the Marriott Corporation writes on his blog once or twice a week, he rarely vents frustrations.And how does 900-plus franchise related web sites have to do with blogging? There’s actually a lot more. Blue MauMau has 2400 franchise related sites recorded in its franchise directory. According to Alexa, a site that tracks traffic by industry category, one can see that most are corporate web sites of franchisors. 68 or so are franchise directories, ad portals of companies such as FranchiseGator.But franchise blogger sites on the Internet? Unfortunately, very, very, very few. The major ones I can list in ten seconds or so. Frankly, the blogosphere could really use a few good men (and women). The industry has been very slow in picking up on this publishing trend. It is an activity that every franchisor CEO and expert should be considering.
Cup A Joe says:
October 23, 2007 at 10:17 am

I had never seen a cuppys coffee until i was in chicago last week on Cicero south of midway airport. i was looking for coffee and drove right past it without seeing it. Waited in line at the Dunkin Donuts drive thru. I saw the cuppys when I was going back… it was tucked back and there were no cars, a sad Grand Opening banner sort of hanging off it.

There was a ton of traffic but no visibility at all from one side and also no place to queue cars if there was a line. They get lost in the landscape.
Dan tdaxp says:
October 28, 2007 at 10:21 am

An excellent discussion!

A similar (if less formal) case study is available on “Dozier Internet Law, PC’s ongoing suit on behalf of DirectBuy.” The case has been examined by Google’s copyright lawyer, among many others.
sean says:
October 28, 2007 at 11:42 am

Dan tdaxp:

I look forward to reviewing the case study as well as your website. I’m not a tech geek; I’m a marketing and PR guy and was involved in the debacle wherein Java Jo’z and/or Cuppy’s tried to heavyhandedly kill blogging discussions and posts they didn’t like. They hired Dozier as a hired gun, and proceeded, in my opinion, to employ tactics that kept adding fuel to the fire and costing them more and more.

My impression is that the front line of Internet development is often being implemented by tech-savvy but communications-ignorant who do stuff because they technically CAN do it, rather than defining the best communications strategy and then deploying technology to accomplish it.

That’s why the first websites were flashy, or clunky, with no clearly defined communications purpose. And that’s why firms arise – perhaps like Dozier – who think they’re slick because they can use technology to manipulate, disrupt and bully, when their clients would be better served by being honest, transparent and joining the discussion.

Am I wrong?
cuppys employee says:
November 16, 2007 at 1:39 pm

Cuppys coffee is all smoke and mirrors!! BEWARE!! Robert Morgan And Ben Doyle are masters at Clocking and ripping people off. Don’t believe anything that they say, as they will say anything you want to hear. Doug Hibbing is a token president at best. Medina, Elite Mgf. Cuppys Are all under one roof and are run by ROBERT MORGAN. Someone needs to look into this deeply to save the people that they are stealing from. Elite is paying the franchise fee for the customer out of a down payment on a building that may or may not ever get built (2 years is average). They even pay for their references (wire fraud)
bill says:
April 9, 2008 at 9:51 pm

Cuppys employee you are right on, Robert (Morg) Morgan runs it all, yet claims he didn’t know when questioned. Then he will lie to you and have his attorny back it up.
sean says:
June 5, 2008 at 11:28 am

Does Cuppy’s Coffee or Elite Manufacturing owe you a refund? Provide an update at: Does Cuppy’s Coffee or Elite Manufacturing Owe You Money?
an employee says:
February 6, 2009 at 9:35 am

Don’t be fooled by the fancy talk and big titles. This company is run by crooks. Doug Hibbing is an accountant. Robert Morgan pulls his strings. Potential franchisee’s are duped out of their savings and mortage their homes based on loose promises and little production. The are left paying off their loans with no product to show for it for 2-3 years. Look for something else to do.
Mauricio Cordova says:
June 11, 2009 at 12:38 pm

I will like to get into contact with any attorney that has a lawsuit against this company, including a class action lawsuit. I invested 30,000 in this franchise and did not receive my money back. I am part of the hundreds of franchisees that were taken advantage of. I would like to get in contact with an attorney. Please contact me at 951 906 6705 or via e-mail.

I am in California, Ronaldo I would like to get in contact with you