Opening a restaurant is a huge endeavor. Signage and décor must be just right. A lot of time and expense is put into opening and running the business. Sometimes a restaurant is bought from a previous owner and a licensing agreement may be put in place outlining the name and décor. With a licensing agreement there can sometimes be a dispute which can lead to business litigation.
A popular eatery in Louisiana might now have to change its name. According to a recent ruling by the court Camellia Grill on South Carrollton Avenue might have to change its name. And not only its name but also the outer part of their building. The restaurant was found to be in breach of the licensing agreement signed when purchased in 2006. The licensing agreement had a provision where the new owner could not change the logo, even in a minor way. If there was a breach then the licensing agreement would be canceled. The new owners changed the shape of the logo which the previous owners claimed was a breach and sued. The restaurant has been open since 1946. The current restaurant owners have filed an appeal of the ruling with the Louisiana Supreme Court.
Corporate agreements of any kind are complex. It can get very tricky when there are licensing agreements, logos and even décor involved. To have a valid contract there has to be offer, acceptance and some type of consideration or some incentive for the parties to enter into a valid contract. A breach is when one or both parties does not do something they were obligated to do in the contract or do not follow the provisions of the contract at all. The party harmed, in this case a corporation, can seek to have the original contract fulfilled, ask for a monetary award based on the damage or rescind the original contract and sue for any advantage the other party gained.
When entering into licensing agreements and contracts with other parties in Louisiana it is important to know your rights. There are experts in business law issues if a dispute occurs and assistance is available if needed.
Source: The Times-Picayune, “Court rules Camellia Grill must change its name, but the restaurant’s owner vows to appeal,” Richard A. Webster, May 9, 2013