Franchise Horror Story - Tiffany Cianci vs Unleashed Brands

What can happen when a private equity firm acquires the franchise system you invested in? You might be surprised. Our guest today Tiffany Cianci owned a "The Little Gym" franchise that was ultimately acquired by Unleashed Brands.
Following the acquisition Tiffany claims most changes made by Unleashed Brands were exclusively one sided to favor the franchisor. Mandated caps on hiring spend, mandated call center and associated fees, new billing system, and significant financial penalties of $100,000 or more if a franchisee was terminated.
Upon advice from her lawyer Tiffany declined signing the new agreement and a franchisee association was created to protect the rights of franchisees. An estimated 93% of all franchisees joined the group of which Tiffany was eventually elected president. Shortly thereafter her "The Little Gym" franchise agreement was terminated and her location taken over by Unleashed Brands.
This is a classic David vs Goliath story as Tiffany and her single lawyer fight against Unleashed Brands who have retained a dozen lawyers from one of the top law firms in the country.
Unleashed Brands has been embroiled in multiple lawsuits including a recent 75 million dollar case launched by disgruntled Premier Fitness franchisees. This lawsuit also alleges RICO (racketeering) activity which could include criminal penalties.
Other brands under the Unleashed Franchise Umbrella: The Little Gym, Premier Martial Arts, Class 101 College Planning, Urban Air Adventure Parks, XP League and Snapology.

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TIFFANYS GOFUNDME PAGE TO HELP WITH LEGAL COSTS: https://gofund.me/cc021725
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TIMESTAMPS

0:00 - 1:10 Introduction
1:30 - 3:20 Why did you invest in "The Little Gym" Franchise?
3:24 - 5:00 Company sold to equity group / Unleashed Franchise Brands. What Happened?
5:16 - 9:38 Significant operational changes demanded by new owners Unleashed Brands
9:44 - 10:00 Previous lawsuit with another Unleashed brand - Urban Air Adventure Park
10:01 -14:00 Lawsuit and demanded changes by Unleashed Brands
14:02 -14:32 The creation of a franchisee association
14:33 -17:05 Minimum $100,000 "Liquidated damages" for The Little Gym and termination penalties
17:10 -17:42 New Mandates to cap labor fees at The Little Gyms (employee pay)
19:43 -22:05 Creation of franchisee association to fight back - and repercussions
22:10 -23:40 Franchise Terminated
23:40 -26:08 "Your termination was not retaliatory" or was it?
26:09 -27:20 4 of 6 Unleashed franchise brands have been sued? RICO charges
27:21 -30:00 Working with Government to try and change laws
30:25 -33:28 What is your ideal resolution? Costs to battle a franchisor
33:30 -36:47 What is the possible motivation for private equity to operate this way?
36:50 -END Final words

Tiffanys new independent business:
Teeter Tots - Music n Motion Frederick Maryland https://teeter-tots.com/

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