The plaintiffs, franchisees of Shoppers Drug Mart, brought a proposed class action alleging breach of contract, breach of the duty of good faith, unjust enrichment, and breach of fiduciary duty regarding the franchisor's retention of rebates and professional allowances, and its practices regarding cost recovery fees, budgeting, and inventory.
The defendants brought a Rule 21 motion to strike the claims for disclosing no reasonable cause of action.
The court struck the claims for rebates, breach of fiduciary duty, interference with association, and duty of disclosure, finding them untenable based on the clear language of the franchise agreements.
However, the court allowed the claims regarding professional allowances, cost recovery fees, budgeting practices, and inventory practices to proceed, finding it was not plain and obvious they would fail.
