How Franchisors & Their Attorneys Silence Franchise Dissent: PIRTEK & Venable llp

For nearly 20 years, the Unhappy Franchisee website has had to withstand numerous attacks from franchisors and their highly paid attorneys.  While their tactics have varied, their goals were the same:  to bully, intimidate & coerce me to stop posting & remove unflattering content about their companies & business practices.  PIRTEK USA & its law firms Venable llp & Faegre Drinker Biddle & Reath LLP are currently demonstrating how franchisors use false accusations of defamation and threats of a SLAPP to intimidate journalists, bloggers and others who dare defy them.  by Sean Kelly

UnhappyFranchisee.Com was actually founded in reaction to a threat.

In 2006, I published FranchisePick.Com, the top business blog in the 400-site B5 Media network (RIP B5).

On my first negative franchise post, I reported that the brother of a fellow blogger complained of being swindled by a now-defunct franchise scheme called Cuppy’s Coffee.

Within hours of the publication, I received a nasty, threatening mail supposedly from Cuppy’s legal department demanding I remove the post immediately.

I responded by writing dozens of investigative posts in the year that followed and exposed a scam that victimized as many as 500 individuals & families.

I started UnhappyFranchisee.com simply as a public depository for all the ensuing complaints from franchisees of different franchises and brands I then received.

In the years that followed, B5 media was sold & Franchise Pick went away;  Unhappy Franchisee (UF) grew in traffic and impact on the industry and individuals.

I never chose to become the Ralph Nader (or the human pincushion) exposing bad franchising.  I guess the role chose me.

Only BlueMauMau.org and I were willing to publish the true nature of an unfortunately growing bad sector of franchising… we were the only ones to give voice to franchisees trapped in modern indentured servitude (or worse).

And then there was only Unhappy Franchisee.

I Have Been Maligned, Defamed, Threatened, Sued & Hacked… But Not Silenced

The attacks that I’ve withstood provide a field guide, of sorts, to the tactics a whistleblower blogger/journalist/troublemaker might expect… and a reassurance that one does not have to give up one’s voice, even if one does not have money to defend oneself.

David Rutkauskas, Beautiful Brands:  David Rutkauskas of the now-defunct Beautiful Brands sued me for $30K on a false claim of defamation, then publicly attacked & disparaged me and threatened my family.

I reacted by posting about Rutkauskas every day until dropped the suit, issued a public apology and deleted his social media accounts before I had to respond to the complaint. (Hat tip to attorney Jon Fortman of Fortmann Spann for his support)

Marc Golob, Butterfly Life:  Marc Golob, CEO of the now-defunct Butterfly Life sued me personally for $35M (yes, $35,000,000) on a false claim of defamation.  With representation by former FTC prosecutor and top franchisee attorney Peter Lagarias, a federal judge in California ruled the suit a SLAPP and awarded me attorney fees without requiring a countersuit.  The judge ruled that UnhappyFranchisee.Com serves an important purpose in the public interest.

Dzana Homan, School of Rock, Attorney Craig Tractenberg, Fox Rothschild:  On behalf of his client, Dzana Homan, former CEO of School of Rock, attorney Craig Tractenberg personally threatened to “ruin me” by exposing my multiple DUIs, my divorces, my unpaid child support, etc. if I didn’t remove content about his client.  Unfortunately for Tractenberg, who had to face a disciplinary investigation by the Supreme Court of Pennsylvania, I’ve never had a DUI, never been arrested, never been divorced and never had to pay child support.  I’ve been married to my first wife for 42 years.  Oops!

Joe Smith, Dennis Mason, NY Bagel Scam:  Joe Smith & Dennis Mason went to great lengths to try to stop my 5-year campaign to stop their Craigs List-based scam, including the creation of false & defamatory websites, videos and email campaigns.  My reporting resulted in 3 successful state investigations, an FBI investigation, a Grand Jury indictment and federal prison sentences for the scammers of hundreds of families.

PIRTEK USA, Michael Joblove, Venable llp:  [Coming Soon.  See below.]

Venable llp Attorney Michael Joblove Threatens Defamation Lawsuit… But Won’t Say What’s Defamatory

An old tactic with a new twist.

I’ve been writing about hydraulic hose repair franchisor’s litigation against its former top franchisee, an Army veteran named Jim Lager.

Venable llp attorney Michael Joblove sent me a letter on July 6, 2023, claiming that I have posted defamatory content about his client, PIRTEK USA, and its officers.

On July 10, 2023, I requested a list of the specific statements he believed met the legal standard of “defamation.”

Rather than provide the list of defamatory statements (or even one defamatory statement) as requested, on July 13 he sent a brief, one-page letter and a 26 page excerpt from a document titled PLAINTIFF’S MEMORANDUM OF LAW IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT dated 1/20/23 by a different law firm than his own (FAEGRE DRINKER BIDDLE & REATH LLP) in a Texas bankruptcy court proceeding that I am not a party to.

I guess the scary-looking lawsuit document was intended to intimidate me.

I could not find any statements that were even borderline defamatory (in my opinion).

Here are some of the potential objections as listed in the lawsuit document:

• The court document claimed that my convention photo caption referring to the “PIRTEK Clan” suggested they were affiliated with a white supremacist group.  At the risk of taking this silly claim seriously, I added a disclaimer saying that I don’t mean to imply PIRTEK & its franchisees are white supremacists.
• The court document objected to the statement that “Jim Lager can’t say anything about PIRTEK, good or bad” and that to keep Lager quiet, PIRTEK has “a team of highly paid attorneys assigned to keeping Lager’s gag tight at all times.”  I think the protracted legal effort to silence Jim Lager proves that statement true… but I added a disclaimer to be courteous.
• They objected to the statement that their treatment of their franchisee reminds me of a movie scene where a victim is beaten & coerced with a rubber hose. I added a disclaimer that this was my opinion, and no PIRTEK hoses, to my knowledge, have been used to beat franchisees.
• The document states that one of my articles asserts that franchisors misleadingly use success stories of military veterans to sell franchises…  Franchisors, including PIRTEK, DO use misleading veteran success stories to sell franchises.  The post documents multiple examples from different franchises that show failed military veteran franchisees as happy & successful.
• The document states:  “Kelly posted an article about PIRTEK on the Unhappy Franchisee Website entitled: “PIRTEK USA CEO … Claim of No Closures in 2020 Questioned.”… The post goes on to question whether PIRTEK has made statements about store closures which are “intentionally misleading.”  CEO Kim Gubera stated in a Franchise Times interview that the company had no closures in 2020.  The PIRTEK FDD states they had multiple closures.  Gubera & PIRTEK USA have been asked for clarification numerous times.  I invited an explanation or correction once again.
• They objected to a post that questions the completeness & truthfulness of a sworn statement from CEO Gubera that was included in the  MEMORANDUM document.  As neither Ms. Gubera nor attorney Joblove have addressed the question, they have failed to point out why they allege the post is defamatory.  I believe questions, per se, are not defamatory.  They are questions.

PIRTEK USA, Mike Joblove, Venable, Faegre Drinker Biddle & Reath:  Your Bullying is No Longer Private

It appears that PIRTEK USA is a lucrative legal client with an open checkbook when it comes to bullying and silencing dissent.

Whether they’ll have the good sense and restraint to communicate professionally and without attempts to chill protected speech remains to be seen.

Hopefully they understand that whatever course they take, they take it out in the open… in the cleansing light of day… in full view of the Court of Public Opinion.

Read:   PIRTEK Attorney Joblove’s Letter to UnhappyFranchisee.Com

071023 SK Response to Michael Joblove Letter of 070623

071323 Joblove 2nd Letter to Sean Kelly

071923 SK Response to Michael Joblove 2nd Letter

OPEN INVITATION to PIRTEK USA, Glenn Duncan, Peter Duncan, Kim Gubera &/or all legal representatives:  You are invited to contact the author with any corrections, clarifications, rebuttals, or alternative points of view.  We encourage respectful discussion & debate and present opinions contrary to ours so that readers can weigh all sides and make their own decisions.  Despite our penchant for humor & sarcasm, we will represent your side of things fairly and respectfully as long as that’s how we receive them.  Contact us at UnhappyFranchisee[at]Gmail[dot)com.

All of this is my opinion.  Everything I say or write is my opinion, except verifiable fact, and therefore non-actionable as defamation.  Not that that will stop them

See all PIRTEK USA Posts.

See posts in the PIRTEK USA v. Lager Franchise Perils Series

 

The words and opinions expressed here are solely the opinions of Sean Kelly, who invites corrections, rebuttals and respectful debate.  Sean Kelly is an independent investigative journalist with 35 years of franchise industry experience.  Since founding UnhappyFranchisee.Com in 2006, his reporting has exposed & shut down several predatory franchise & investment schemes.  Sean Kelly is a franchise watchdog who prompted and aided the FBI investigation that shut down the 165-victim multi-million-dollar NY Bagel franchise scam and landed perpetrators Dennis Mason & Joseph Smith in federal prison.  Sean was featured in the ABC Four Corners expose of 7-Eleven wage theft in Australia and has served as an advisor to Dateline NBC.  He has withstood bullying, intimidation & frivolous lawsuits as high as $35M and never lost.  His crack editorial staff and fact checkers include Chick, Gem, Red, Pru & Joanie the Rescue Chicken.

Contact the author at UnhappyFranchisee[at]Gmail[dot]com

TAGS:  PIRTEK, PIRTEK USA franchise, PIRTEK Australia, Kim Gubera, Glenn Duncan, Peter Duncan, Michael Joblove, Venable, Faegre Drinker, David Kauffman, Kauffman Gildin & Robbins, Jim Lager, Sean Kelly, Franchise litigation, franchise arbitration, Franchise NDAs, Franchise gag orders