The plaintiff franchisor brought a motion for an interim injunction to enforce restrictive covenants contained in a terminated franchise agreement.
The agreement prohibited the franchisee and its principal from operating a competing pet supply business within a specified geographic radius and from soliciting employees following termination.
Evidence showed that a competing store was opened nearby through a newly incorporated company associated with the franchisee’s spouse and that the former franchisee remained involved in its operations.
The court found a prima facie breach of the non‑competition, non‑solicitation, and post‑termination obligations, concluding that the new corporation was used to conceal the franchisee’s continued participation.
The court held that where a clear breach of a negative covenant in a franchise agreement is established, proof of irreparable harm and balance of convenience is not required, though the evidence would have satisfied those elements in any event.
