Court stops franchisor from continuing legal action against ex-franchisees

24 December 1999
The Australian Competition and Consumer Commission obtained an interim injunction against franchisor, Simply No Knead (Franchising) Pty Ltd in the Federal Court, Melbourne today.

The injunction stops Simply No Knead, supplier of bread-making ingredients, from taking any further steps in its legal actions against four of its ex-franchisees until determination of the ACCC's legal action against Simply No Knead.

"The injunction is conditional upon the ex-franchisees giving an undertaking to the Court that they will not continue their counterclaims against Simply No Knead until the ACCC's court action is determined", ACCC Chairman, Professor Allan Fels, said today.

"The injunction was sought by the ACCC as part of its action commenced in June 1999 against Simply No Knead, which alleged that Simply No Knead engaged in unconscionable conduct and breaches of the Franchising Code in contravention of the Trade Practices Act 1974. The ACCC also alleges that the director of Simply No Knead aided and abetted, or was knowingly concerned in the alleged breaches", Professor Fels said.

Justice Sundberg also refused Simply No Knead's application to stop the ACCC's legal action against it. Further, Justice Sundberg ordered Simply No Knead to pay the ACCC's costs.

This case will be back in court early in the new year.
Release number: 
MR 261/99
ACCC Infocentre: 

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