Franchisor awarded £21,000 after restaurant breached trademarks

A franchise chain has been awarded £21,000 compensation after a former client breached its trademarks.

The case involved Mr Waseem Ghias who owned several trademarks using the words GRILLER and GRILLO, which he used in association with a network of fried chicken restaurant franchises. Muhammad Khalid Malik became a franchisee for a while but then left the network.

Mr Ghias brought proceedings alleging that Mr Malik had continued to use his trademarks after termination of the franchise agreement and had then changed to using another name, GRILL’O XPRESS LTD, which infringed his marks.

The court found in favour of Mr Ghias at an initial hearing and so he then claimed damages based on the fees Mr Malik would have had to pay to remain a franchisee. He also sought additional damages on the basis that Mr Malik knew that he was infringing the trademarks.

The court held that damages should be assessed liberally but were compensatory, not punitive.

It assessed that the appropriate figure for the initial franchise fee was £7,500 with a continuing fee of £400 per month for 32 months. Mr Ghias was entitled to interest at 2.75% on the initial fee for the 32-month period and on the continuing fee for half that period.

That produced a total damages award of just over £21,000. The court ruled there was no case for additional punitive charges.

Please contact Sarah Liddiard if you would like more information about the issues raised in this article or any aspect of protecting trademarks and intellectual property.