The owners and operators of the Eddie Rockets diner chain have secured a temporary High Court injunction aimed at restraining a transfer of two of its franchises to the owner of a rival restaurant business.
The action relates to alleged breaches of agreements, including ones for franchise holders to sell Dublin franchises at Charlestown Shopping Centre in Finglas and in Clarehall to Eddie Rockets.
Eddie Rockets claims that in what amounts to “flagrant and fundamental“ breaches of the sale and franchise agreements, the two franchises have been transferred to the owner and operator of rival restaurants.
Eddie Rockets (Ireland) Limited and the related Rockets Franchising DAC have brought proceedings against Ziggy Investments Ltd, Lisa Marie Deegan, Jacinta Deegan and Brian Dunne.
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Ziggy Investments holds the two franchises issued by the plaintiffs in 2020. The Deegans are alleged to be shareholders and directors of Ziggy Investments.
The court heard Mr Dunne is a former franchise holder of Eddie Rockets who is alleged to have acquired Ziggy Investments. It is also claimed he operates businesses in competition to the plaintiffs.
The plaintiffs secured a temporary injunction preventing the defendants from breaching the terms of the various alleged agreements regarding the Charlestown and Clarehall franchises.
The defendants must also adhere to the sale agreements to sell Ziggy Investments’ business to the plaintiffs, the court ordered.
The court also made orders restraining Mr Dunne from using or interfering with the plaintiffs’ intellectual property.
Seeking the orders, barrister Jarlath Ryan, instructed by Philip Lee solicitors, said his clients say agreements were in place for Eddie Rockets to buy the franchises from Ziggy Investments.
Those agreements were advanced but not complete after his clients were informed earlier this month that Ziggy Investments had been sold to another party.
To his clients’ surprise, they received a subsequent phone call from Mr Dunne informing them he was taking over and would operate the two franchises.
The agreements do not allow Mr Dunne to acquire the two Eddie Rockets franchises, counsel said.
He said the terms of Eddie Rockets’s franchise agreements are rigorous and restrain holders from transferring them to other parties without the plaintiffs‘ prior consent.
Holders must also undergo training courses, and cannot operate or own rival businesses.
Counsel said his clients also have concerns about the use of their confidential information and intellectual property rights.
Counsel said his clients sought, but have not received, undertakings from the defendants to cease operating the franchises.
The orders were granted on an ex parte basis by Mr Justice David Nolan on Wednesday.
The judge scheduled for the case to return later this week.
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