Joe Lieberman Sues Huntington Learning Centers Franchise
Joe Lieberman is suing Huntington Learning Centers and top executives Dr. Ray Huntington, Anne Huntington, Eileen Huntington, Jim Emmerson and Marilena O’Neill. In the suit, Lieberman claims that Huntington uses fraud, misrepresentation and deception to sell its flawed franchise investment to trusting individuals.
(UnhappyFranchisee.Com) Huntington Learning Centers aggressively markets its franchise opportunity (with an initial investment of $120K – $270K) using claims such as “highest grossing tutoring franchise,” “immune to recession,” “unparalleled franchisee support,” and “over 40 years of proven success and leadership…”
Sounds too good to fail, right?
They even use the tagline “Huntington Helps” in the URL of their website.
Some former franchise owners think a more accurate tagline would be “Huntington Helps Themselves.”
They feel that Huntington Learning Centers, including founders Dr. Ray Huntington and Eileen Huntington, helped themselves to their savings, their 401Ks, their home equity and their family’s financial futures.
They feel that Huntington exploited their dreams of business ownership and misled them into buying into a system with one of the highest franchisee turnover rates in the country.
And when the system they were sold had fully drained them… the helpful Huntington franchisor sued them to extract their last bit of equity, dignity and willingness to warn others.
Warning About The Huntington Learning Center Franchise since 2012…
We first posted about the disconnect between Huntington Franchise Hype and Huntington Franchise Reality back in 2012 with this post on the disturbingly high SBA loan default rate at that time*:
HUNTINGTON LEARNING CENTERS Franchise Complaints
In 2016, an Anonymous ex-franchisee posted a comment:
Huntington is fabulous at the marketing but they are nothing but a complete scam and are very good at blaming franchisees for any problems. Purchasing a Huntington franchise gives you the worst of all worlds. You have the added expense and headaches of a franchise with none of the support or experience that could be a benefit.
In 2015, we looked in on Huntington to see if things had improved. The Huntington FDD still revealed disturbingly high franchisee turnover, shared here::
HUNTINGTON Franchise: Is it a Great Business to Own?
In fairness, we also pointed out that Huntington isn’t alone, or even the worst, when it comes to tutoring franchise turnover. The whole tutoring segment is problematic:
Tutoring Franchise Failure Rates of the Top Education Brands
When we came across the court filing of a Huntington Learning Center lawsuit against a former franchisee in Kansas who is trying to battle back without an attorney, we decided to revisit Huntington Learning Center franchise one more time.
* The current default rate may be different.
Franchisee Joe Lieberman Fires Back… And His Countersuit is Revealing
One can deduce from the court documents that franchisee Joe Lieberman, of Overland Park, Kansas, followed the Huntington Learning Center system, and had the benefit of what Huntington calls “unparalleled franchisee support.”
Yet Mr. Lieberman allegedly struggled to keep his franchise open and “worked for three years for only one salary payment of $6,000.”
According to Lieberman’s court filing document: “Because of Huntington’s improper interference with Defendants’ operations, Defendants were unable to make any profit with their franchise and had to shut down in October 2018 after running out of money. Defendants may be forced into bankruptcy as a result.”
Suffering purported losses of more than $280,000, Joe Lieberman apparently had no choice but to close the doors of his learning center, the Huntington franchise that had once been his dream.
On October 25, 2018, rather than sending a fruit basket and a condolence card, Huntington Learning Centers, Inc. and Huntington Learning Corporation (HLC) hit their former franchisee with a lawsuit filed in the Superior Court of New Jersey, Bergen County.
The company that promises owners a “strong emotional return on investment” now demanded more than $20,000 in damages, the attorneys fees and litigation costs they incurred suing him, and interest of 18% per year or the “highest legal rate of interest permitted by law” sums due.
Huntington Learning Centers, Inc. retained attorney David E. Worthen of powerhouse Washington law firm Quarles & Brady, LLP and Phillip C. Bauknight of Fisher & Phillips LLP, Murray Hill, NJ, to tag-team and legally crush their nearly bankrupt former franchise owner – apparently the second Huntington owner to fail in the same territory.
Apparently unable to afford an attorney to stand up to Huntington’s legal enforcers, Joe Lieberman filed a countersuit, by himself, against the arguably predatory Huntington Learning Centers.
And his counter suit is revealing.
Franchise Owner Alleges Fraud by Huntington Learning Center, Ray & Eileen Huntington, Others
Huntington Learning Center franchise owner – and litigation target – Joe Lieberman drafted and filed his own Answer, Counterclaims & and Third-Party Complaint in response to the franchisor’s lawsuit.
In Lieberman’s lawsuit, he named Huntington co-founders Dr. Ray Huntington and Eileen C. Huntington, HLC’s VP of business Development Anne Huntington, HLC’s CFO Jim Emmerson, and HLC’s Director of Franchise Operations Marilena O’Neill.
According to Lieberman’s Counterclaims and Third-Party Claims:
Huntington induces prospective franchisees to enter into Franchise Agreements with Huntington through false, misleading, and deceptive statements and without disclosing facts known to Huntington that are material to a prospective franchisee’s decision to enter into such Franchise Agreements. These false, misleading, and deceptive statements and material omissions are part of Huntington’s standard pitch to prospective franchisees.
Half of All Huntington Learning Franchise Owners Fail – Lieberman
In his counterclaim document, former franchisee Joe Lieberman claims that Huntington tricked him into investing in their franchise program by providing gross sales numbers that were inflated by a single franchise location that had huge government contracts unavailable an ordinary franchisee like himself.
Lieberman claimed that later he realized the “truth”: that the Huntington Learning Centers franchise is unprofitable and unsustainable for as many as half of its franchise owners.
His counterclaim states:
Huntington also failed to advise Lieberman that half of all franchisees in the Huntington system generate less than $300,000 in annual sales… [and] are unable to make a reasonable profit.
Lieberman also claims that Huntington never told him that a previous franchise location had opened – and failed – in the same franchise area they had sold him.
Lieberman claims that part of the reason for his (and assumedly others’) demise was the support Huntington franchise marketing materials describe as “unparalleled.”
Lieberman claims that Huntington advised him to use a marketing tactic that turned out to be illegal in his market, and directed him to spend $5,000 per month on marketing efforts that provided “no material benefit.”
Judging by his complaint, Joe Lieberman has chutzpah. Despite being up against two well-funded corporations and their two highly paid law firms, Lieberman is asking the court for compensatory, incidental and consequential damages, punitive damages, reasonable expenses and costs, pre- and post- judgement interest, and other relief the Court deems appropriate.
Judging by the fact that he is refusing to roll over without a fight, Huntington Learning Centers former franchise owner Joe Lieberman obviously believes that Truth is on his side.
We don’t know if it will be enough for him to prevail as a self-represented underdog in our skewed legal system.
But his relentless determination to stand up to legal bullies is enough to earn him an UnhappyFranchisee.Com Chutzpah Award.
NOTE 1: Some characterizations of the parties’ situations and intentions are conjecture based solely on the court filings, and may be incorrect or mischaracterized. We invite Huntington Learning and franchisee Joe Lieberman to correct us where we’ve erred.
NOTE 2: It is the policy of Unhappy Franchisee.Com to invite companies and individuals discussed on this site to provide corrections, clarifications, rebuttals and/or statements of their points of view. They may post messages in the comment section or email us at UnhappyFranchisee[dot]com. We will attempt to reach out to Plaintiffs, Defendants and their attorneys and invite them to join the conversation regarding these important issues.
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Huntington Learning Center Franchise Posts
WHAT DO YOU THINK? ARE YOU A HUNTINGTON FRANCHISE OWNER OR FORMER FRANCHISEE? SHARE YOUR OPINION BELOW.
TAGS: Huntington Learning Center, Huntington Learning Center franchise, Huntington Learning Center franchise opportunity, Huntington Learning Center franchise complaints, Huntington franchise, Huntington franchise opportunity, Huntington complaints, Huntington franchise failure rate, Huntington Learning Center Closed, Joe Lieberman, Dr. Ray Huntington, Eileen Huntington, Anne Huntington, Jim Emmerson, Marilena O’Neill, unhappy franchisee
From Anonymous Huntington Franchisee:
I think Joe is right in that one center, a center in New York post numbers that are not attainable by others and that it skews the numbers. And I think you are right, when Joe closed his does, he should have gotten a thank you, but as you state, HLC will enforce the contract and go for blood. You try your best, spend time and money, it does work out, HLC drives you in bankruptcy, but while you are open, wants you to believe they care about you.
You are also right in that HLC pushes you to put out yard signs which are also illegal in my territory.
I wish Joe well, because I disagree with HLC’s tactics.
I too agreed that HLC is nothing like what is sold to Franchisees. You have a hand in your pocket at all times. Marketing is outdated and if you bring it up you are treated as if you are breaking the agreement.
The center in NY is a gross misrepresentation of what normal operations/revenues are.
I have been warned that any yard sign found in my area is a fine however, FBC says “step outside your comfort zone” (typical response to any problem).
I wish Joe the best and fear I may not be too far behind myself.
What is disgraceful is this has been going on for decades with this system. Providing fraudulently inflated revenue numbers to potential franchisees to get them to sign on the dotted line, while apparently common at HLC, is also common at most other franchise systems.
What is most disgraceful, however, is that HLC franchisees put their thumbs in their ass and play ‘sit and spin’ rather than band together and fight. The want someone to do all the work, have them put their necks on the line, instead of having the guts to stand and fight. You all got what you deserved.
I am a former employee of Joe’s Huntington who worked there for about a year and a half until its eventual closing. If I had to guess, the writing started to show up on the wall about three months after I started there, but I had no real suspicions of it closing when it did because October was a traditionally slow month for us. The October before, there were weeks when I wasn’t getting any hours, period. I figured the situation at the center was similar until my assistant manager called me in November saying that the center had closed. For a while, I blamed Joe for not telling us sooner, but after coming across this page, I have a new admiration for him.
The problem with Joe’s Huntington, and I suspect many others like it, is that the staff is made up entirely of bright, young college students (generally for the ACT/SAT programs) and retired elementary school teachers. The latter are normally satisfied with their situation and see it as an extra way to make money, while the college students left far more often. I was considered the senior ACT/SAT tutor after just a year and a half of employment because everyone else had gone elsewhere. This was no fault of the tutors themselves, though–our best math tutor was offered a full ride to Harvard for his master’s degree. There are simply too many good opportunities for this age group that Huntington pales in comparison. Even though I was a loyal Huntington employee, I was also training to be a librarian at the time, and I would have certainly quit Huntington if the library market wasn’t so competitive in my county.
Since I had yet to finish my Master’s of Library Science after the past Huntington closed, I applied to another Huntington opening up in the area a few months later (mostly in the hopes I could get a higher-level position to look good on my resume). I did, but it made me realize how different Joe’s Huntington really was. Joe was consistently docked by corporate for relatively frivolous things that mostly involved not complying to uniformity standards. Joe loved classic rock and had a record collection hanging over the front desk. It was very cool and distinctive, in my opinion, and probably made the place feel more comfortable to kids. In addition, he had a few other music store-like touches in the center, like kitsch ’80s band posters in the bathrooms, which corporate did not like.
The center I work at now is much more compliant to corporate standards, which are essentially bland shades of white and green. The only real distinctive detail is a child’s drawing of a Hindu god, likely done by the franchisee’s daughter. Since my new boss is a naturalized citizen from India, I get the impression that this is the only way she was allowed to honor her heritage, which is quite sad. It’s in the type of suburban location where more “ethnic” decoration is embraced by many businesses, so it could be quite successful with a design that stands out a little more.
Also not helping matters is the fact that my area’s Huntingtons are often placed next door to popular food chains–a Chipotle by Joe’s location and an Orange Leaf by the current one. People will often know exactly where the Chipotle is if I tell them, but not where the tutoring center was. (Although I am not too upset about the Orange Leaf case–the franchisee there is very kind and helps us a lot with drumming in customers, giving younger students coupons for free frozen yogurt, and the like. We never really had this kind of contact with the Chipotle owners, though I did end up meeting my current boyfriend there while I was on break. My relationship with him has already lasted longer than I worked at that Huntington.)