Facts
John Rudzewicz was a citizen and resident of the state of Michigan and was the senior partner in a Detroit accounting firm. He was approached by Brian MacShara, the son of a business acquaintance, who suggested that they open a Burger King franchise together. The parties eventually reached an agreement whereby Rudzewicz provided the necessary capital and MacShara assumed the responsibility of managing the restaurant. The partners agreed to share profits equally.
Rudzewicz and MacShara applied jointly to Burger King's district office in Birmingham, Michigan in the fall of 1978. The application was forwarded to Burger King's office in Miami, Florida and the parties reached a preliminary agreement to take the franchise for an existing Burger King location in the Drayton Plains area of Waterford Charter Township, Michigan in February 1979. MacShara attended the prescribed management courses at Burger King University in Miami in order to learn to operate a Burger King franchise. The partners purchased $165,000 in restaurant equipment from Davmor Industries, a Burger King corporate division located in Miami.
Under the franchise agreement, Rudzewicz and MacShara were to remit their franchise fees and royalties to Burger King's Florida headquarters. Due to an economic downturn, the defendants were unable to make their monthly payments to Burger King, prompting the Florida-based corporation to file a lawsuit in Florida for breach of contract and infringement of Burger King's trademarks and service marks through the defendants' unauthorized operation as a Burger King restaurant after the defendants received notice to vacate the premises.
Read more about this topic: Burger King V. Rudzewicz
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