Sixty-eight BBQ Chicken franchise owners have filed a lawsuit against Genesis BBQ Group, the head office, demanding a refund of the difference in franchise fees. The difference in franchise fees is a type of 'distribution margin' that the headquarters earns by supplying raw materials at prices higher than the market wholesale price.
According to the distribution industry on the 6th, some BBQ Chicken franchise owners filed a lawsuit against Genesis BBQ Group at the Seoul Eastern District Court that day, seeking the return of unjust enrichment. The lawsuit amount is calculated at 1 million won per person, totaling 68 million won. The franchise owners claim that 'the difference in franchise fees taken by the head office is excessive.'
The difference in franchise fee lawsuit began in September of last year when franchise owners of Korea Pizza Hut filed a lawsuit related to the difference in franchise fees, and the court ruled in favor of the franchise owners. Some franchise owners of Lotte Super, Lotte Fresh, BHC Chicken, Kyochon Chicken, and Baskin-Robbins have also filed similar lawsuits against the headquarters.
BBQ Chicken stated, 'When entering into contracts with franchise owners, we inform them in advance about the prices at which we supply ingredients, chopsticks, and paper goods,' adding that 'the situation is completely different from the Pizza Hut ruling case.'