Dec. 27—Virginia-headquartered Western Sizzlin Corp. filed a lawsuit against five defendants — including several Dalton restauranteurs — on Dec. 19.
The filings submitted in the United States District Court’s Northern District of Georgia seek a jury trial “for injunctive relief, monetary damages and all other appropriate remedies” against Georgia Service System LLC; D&S Service Systems LLC: Johnny D. Miller; Dion Johnston; and Sarah Johnston.
“After doing business as a Western Sizzlin franchise for decades, the defendants acting in concert removed the ‘Western Sizzlin’ sign where it stood and put the name of another steak buffet in its place,” the complaint alleges. “They did so despite clear contractual obligations preventing that very action and with full knowledge of the business garnered from the goodwill, information, methods and processes perfected by Western Sizzlin and learned by the former franchisee GSS.”
The lawsuit seeks a temporary restraining order and a preliminary and permanent injunction against the alleged “wrongful and unlawful use of Western Sizzlin’s protected trademarks and trade dress.”
The civil action also seeks enforcement of “the post-termination obligations set forth in the franchise agreement entered into by and between GSS and Western Sizzlin.”
Per the 50-page complaint, Western Sizzlin initially entered into a 20-year franchise agreement with David F. Burris Sr. in 1994 to operate a restaurant in Dalton.
The complaint indicates Burris transferred the franchise agreement rights, title and interest to Miller in 1999.
“On or about Dec. 27, 1999, Miller executed a personal guaranty with Western Sizzlin, in which Miller bound himself as the individual guarantor of GSS, the sole named franchisee,” the claim reads. “On or about Dec. 12, 2003, GSS executed an addendum to (the) franchise agreement, agreeing to extend the term of the franchise agreement until Dec. 12, 2023.”
The claim alleges that Western Sizzlin emailed Miller on Nov. 9, 2023, and asked him if GSS was interested in renewing the franchise agreement. A follow-up email was sent on Nov. 20, 2023.
The complainant indicates that neither Miller or GSS responded to either message.
“Upon information and belief, on or about Dec. 1, 2023, GSS attempted to transfer its interest in the franchise agreement to D&S,” the lawsuit claims. “GSS did not notify Western Sizzlin of this transfer or provide written notice that it did not intend to renew the franchise agreement.”
In mid-December, the complainants allege that D&S “began removing all Western Sizzlin signage from the Dalton location” and replaced them with signage for Yellowstone Steak and Buffet.
“Upon information and belief, D&S’ Yellowstone is advertising and offering a menu substantially the same as that offered by the original Western Sizzlin,” the complaint reads. “Upon information and belief, D&S is also offering other menu items created from Western Sizzlin proprietary recipes, including but not limited to rolls, honey butter and ranch dressing.”
The complaint alleges that the defendants “continue to use the Western Sizzlin marks, trade dress and Western Sizzlin system in connection with the operation of Yellowstone to market and promote Yellowstone through the use of Western Sizzlin marks, trade dress and Western Sizzlin proprietary products and to pass off Yellowstone and its unapproved products offered by Yellowstone as being authorized by Western Sizzlin when they are not.”
The lawsuit accuses GSS and Miller of “breach of contract” and accuses D&S of “trademark infringement,” “federal trade dress infringement,” “common law trade dress infringement” and “common law unfair competition.”
The complainant also alleges all of the named defendants in the suit purportedly violated Georgia’s Unfair Competition Statute.
“As a direct and proximate result of (the) defendants’ unfair competition, Western Sizzlin has been and is likely to be substantially injured in its business, including its goodwill and reputation, resulting in lost revenues and profits and diminished goodwill,” the suit alleges.
The lawsuit also alleges that the named defendants purportedly violated the state’s Trade Secrets Act.
“GSS has failed to return the operations manual or any proprietary products to Western Sizzlin upon termination of the franchise agreement,” the suit claims. “Upon information and belief, GSS has transferred or shared the operations manual with D&S with access to proprietary Western Sizzlin information, including recipes.”
Yet another accusation in the suit alleges that D&S and the Johnstons have been “unjustly enriched,” with Western Sizzlin purportedly suffering “damages” as a result.
The complaint includes a verification statement from Western Sizzlin Corp. Vice President and CEO Robyn Mabe.
As for “relief,” the lawsuit seeks “that GSS account and pay over to Western Sizzlin all consideration received in exchange for GSS transfer of its franchise agreement to D&S” and “that Miller, Dion Johnston and Sarah Johnston each account and pay over to Western Sizzlin all profits it has made from the Yellowstone restaurant since Dec. 13, 2023.”
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