Samica Enterprises LLC v. Mail Boxes Etc., Inc.

MEMORANDUM

Appellants, approximately 200 franchisees of “The UPS Store” franchise, sued franchisor Mail Boxes Etc., Inc. (“MBE”), United Parcel Service (“UPS”), and other UPS subsidiaries (collectively “Appellees”), alleging various state law claims. The district court granted summary judgment in favor of Appellees on all of them. Appellants timely appealed. We affirm.

Appellants brought claims under the California Franchise Investment Law (“CFIL”) and common law fraud and misrepresentation, alleging that MBE and UPS made untrue statements of material fact and omitted material facts from various communications made in connection with the offer and sale of the franchises and in connection with the conversion from the old franchise model to the new “The UPS Store” franchise model. Reasonable reliance is required under Cal. Corp.Code § 31300, the CFIL section imposing liability for misrepresentations made in franchise documents, as it requires that the damages to the franchisee be “caused [ ]by” the misrepresentations. See Mirkin v. Wasserman, 5 Cal.4th 1082, 1092 , 23 Cal.Rptr.2d 101 , 858 P.2d 568 (Cal.1993); Younan v. Equifax Inc., 111 Cal.App.3d 498 , 169 Cal.Rptr. 478, 487…