001014 Burger King Loses Round in $1.9B LawsuitOctober 2, 2000Detroit, MI - Burger King and Pizza Hut guru, LaVan Hawkins, recently won “round one” in his $1.9 billion lawsuit against Burger King Corporation. Famed Attorney Willie Gary of Florida is representing Hawkins, with Attorney Norman Yatooma of Michigan. Chief U.S. District Judge, William J. Zloch (Southern District of Florida) stayed Burger King's action against Hawkins' UrbanCityFood Group in Florida. Burger King's lawsuit included a request for an injunction to close down Hawkins' 27 franchise restaurants in Michigan and throughout the country. The court ruled that where the litigation was first filed dictates where the proceedings will be litigated when there is a substantial overlap between the issues raised in parallel proceedings in two different jurisdictions. Accordingly, the court ordered that Burger King's action was to be marked as closed. Noting that Burger King filed a $6.5 million lawsuit against Hawkins in Miami just five days after Hawkins sued Burger King for $1.9 billion in Detroit, attorney Maria Sperando of the Gary firm stated that the court reached the right conclusion for the right reasons. “The court in Florida could have issued an injunction against Hawkins shutting down his stores, but decided not to based on the 'first filed' rule,” Sperando said. Burger King Corporation, a division of DIAGEO, Inc., based in London, England, is a franchise giant with U.S. revenues in excess of $4.5 billion. Hawkins chairman and CEO of UrbanCityFoods, reported revenues of $128 million in 1998. Hawkins initiated the litigation in the U.S. District Court in Detroit for reasons of fraud, misrepresentation, breach of contract, and racial discrimination, among other issues. This case is pending before Federal Judge Marianne Battani. According to the July 31, 2000 Financial Times, Reverend Jesse Jackson has been called in to mediate the case. Gary refers to Hawkins as “the Bill Gates of the fast food industry” and accused Burger King of reneging on its commitments after benefiting from Hawkins' genius The Florida court's decision prompted Burger King's recent multimillion dollar settlement offer to Hawkins. Hawkins rejected the offer saying, “My community and I have been deeply wronged by Burger King. I am a businessman who is prepared to stand up to a big corporation in order to give back to my community and my employees because we've all been wronged and subjected to injustice by Burger King.” Hawkins is an active member of the community who has given hundreds of thousands of dollars to children's causes and other charities. National activists who support him, including Dick Gregory, Reverend Al Sharpton, and Reverend Wendell Anthony (President, NAACP Detroit Chapter), consistently emphasize that the fight with Burger King is not about Hawkins, but about the fact that “promises made should be promises kept. Burger King's promise to award Hawkins 225 franchise stores over five years has been broken and Hawkins and the community that he represents have been irreparably damaged as a result,” Reverend Sharpton said. In order to pursue the lawsuit, Hawkins placed $6.5 million in escrow to collateralize the claims Burger King made against him for royalties and rent. Noting that the $6.5 million would be a set-off against the millions of dollars that Burger King owes him in lost profits and exemplary damages, Hawkins emphasizes the importance of the commitments that he has made to his community.
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