BDK, Inc. v. Escape Enterprises, Inc.

MEMORANDUM *

This lawsuit arises out of a failed business relationship between plaintiffs BDK, Inc., Donna Kittilson, and Brian Markee (collectively “BDK”) and defendants Escape Enterprises, Inc. and its successor in interest, Escape Enterprises, Ltd. (collectively “Escape”), involving seven “Steak Escape” restaurant franchises. Following a protracted dispute about royalty payments, BDK sued Escape in King County Superior Court in the State of Washington, alleging violations of Washington’s Franchise Investment Protection Act (“FIPA”) and the Washington Consumer Protection Act. BDK’s complaint also alleged breach of contract and sought declaratory relief and attorney’s fees. Escape removed the case to the United States District Court for the Western District of Washington, and asserted counterclaims for federal and common law trademark infringement, statutory and common law unfair competition, and breach of contract. Escape also sought declaratory relief and attorney’s fees.

Escape moved to stay the proceedings pending arbitration, based on arbitration clauses in four of the franchise agreements (South Hill, Kitsap, Tacoma, and Alderwood). The district court granted Escape’s…