People Lie. People Cheat. People Advertise.
December 14, 2007 by Sean Kelly
Filed under BARISTA'S DAILY GRIND (RIP), xBuyer Beware, xFranchise Graveyard
Steven Sickler, Founder of Failed Barista’s Franchise Company Who Says Law Firm Deceived Him, Responds to Franchise Pick Article.
(FranchisePick.Com) My October post Want to Franchise Your Business? Do Your Homework First recounted the unfortunate cautionary tale of a promising coffee concept called Barista’s and Barista’s founders Steven Sickler and Cathy Mettenbrick. In an earlier post (FTC Stops Coffee Shop Franchisors) attorney Michael Webster reported how the FTC came down on Barista’s and Friends, Inc. for selling franchises with woefully inadequate franchise disclosure documents, and for providing earnings projections in violation of the legally required procedures
Based on the popularity of Barista’s and their ability to sell 40 franchises right out of the gate, I concluded:
Barista’s and Friends was obviously a promising young chain, one that had the potential to make its mark as one of franchising’s new success stories. While the founders can blame the attorney and blame the bank all they want, but the fact remains that, had they done their homework both on franchising and on those they hired, they might be one of the success stories being touted on Top New Franchises or FranBest Coffee, instead of another cautionary tale on FranchisePick.
Today, Barista’s founder Steven Sickler responded to the the Franchise Pick post:
In response to the article, as the owner and developer of the Barista’s Franchise we did our home work with the information we could find in 2001. We visited with several law firms regarding the franchise concept. We chose the Jacobson Orr law firm as they were advertising on the world wide web that they specialized in franchise and franchising. We set up an interview with the firm and were told they took the Buckle public, worked on Quizno’s, Thirsty’s and several others.
We put our trust with this law firm to guide us in the right direction, what a let down! At a later date we were getting feedback from lawyers in other states indicating there was a problem with the documents. We then approached and e-mailed the Jacobson Orr firm a memo that we wanted a second opinion regarding the compliance of our documents. The Orr firm then hired legal council from Omaha representing themselves as specializing in franchise law to redraft the documents on our behalf. These also turned out to be errant and noncompliant. After hiring yet a third law firm, it was discovered that neither firm involved with drafting had experience in franchise or franchising. Both firms held themselves out has having franchise experience to the point they advertised as such.
A friend of mine is a foot doctor, would he ever advertise that he specializes in heart transplants? What would be his liability if he performed a heart transplant and his client later died because he didn’t know he was supposed to reattach all of parts?
I don’t mean to add insult to injury, and I empathize with the tragic results of Steven and his partner’s dream. He appears to have been deceived by a reckless and irresponsible law firm he trusted. At the same time, there’s an important lesson here for prospective franchisors, franchisees or investors of any kind: If you think a particular company or opportunity is legitimate or credible because they advertise that they are, you are in for an expensive lesson in reality.
Think about it:
Were those Sea Monkeys you ordered from the back of the comic book just like they were advertised?
Do you think anyone really became a millionaire because Don Lapre’s tapes taught them how to run itty bitty ads, then watch the checks roll in?
Do you think ANYONE ever got “concrete abs” by making 3 EZ payments for the Ab Roller, Ab lazer, Ab Pony, Ab Rocket or Hip Hop Abs tapes?
Do you think Richard Quick’s GRATE FUN! Child Adventure Systems is a great franchise?
If so, could I interest you in a slightly used Don Stewart Green Prosperity Prayer Hankie?
People lie. People cheat. People steal. People deceive.
And no one stops them from advertising that they don’t.
YOUR COMMENTS, AS ALWAYS, ARE APPRECIATED.
Check out these franchise websites:
TopNewFranchises.Com: America’s Next Top New Franchises
FranBest.Com: The Best in Franchising
Franchise & Marketing Newsletters: Affordable. Stylish. Free.
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FREE WHITEPAPER: What’s the best way for companies to respond to online criticism and attacks? A Harvard report with multiple recent case studies compiled and is available for free download.
………….
It’s no longer Wordless Wednesday, Joel. You may now communicate via self-contained linguistic units. At least until Wednesday.
Thank You.
Joel
Sean;
There is a lot of blame to go around here; but passing the entire buck to your advisors won’t fly.
Michael,
Are you suggesting that one needs to look at himself or herself to see what their role was in the situation.
Cmon!
Joel Libava
Joel;
I know: terrible to suggest that one ought to look in mirror.
Personally, I have taped over all the mirrors in my house.
Mistakes were made, but not by me.
Michael:
These attorneys had zero experience - so little in fact they weren’t even familiar with the franchise legal terms “Cut & Paste” and “Search & Replace.” Nor did they have FranDocs on speed dial, or a Frequent Buyer card from UFOCs R US (Buy 3 the 4th’s half price).
Just kidding… just kidding… no need to send me outraged slander letter #12
“…passing the entire buck to your advisors won’t fly…”
No, I believe his attorneys required that he pass the entire buck to them before they commenced drafting. They might be clueless, but they are still lawyers.
“Personally, I have taped over all the mirrors in my house.” So has Joel, Michael, but for a different reason. The same reason his wife taped over her glasses.
OK: Now that I’ve thoroughly insulted the legal profession and the King of franchising, I shall risk appearing as one who kicks’m when they’re down. Stephen should actually be thankful that his venture into franchising was this short-lived. Anyone who would accept the life savings of so many individuals while having done so little homework and learned so little about franchising, would be headed for much bigger trouble than he got into. What a nightmare franchisor he would have been… especially since he - as Michael says - does not accept any responsibility for his failure. I’m sorry, Steven, but had you invested $15 and four hours with “Franchising For Dummies” you wouldn’t be in this spot. (Or three hours on the Internet.)
Important lesson: You cannot blindly leave the fate of your company in the hands of any advisor. The rewards, consequences and responsibility are yours.
My wife feels whole again. Thanx
Joel
Wow and all I wanted to know was what were the 3 p’s of sales and why do people advertise?, for my homework assignment. I got 1. people lie, 2. people cheat, 3. people advertise.