No inspection of Association C1000 in documents C1000 acquisition.

The Court in preliminary relief proceedings has ruled on the question whether the C1000 franchisees have the right to know what agreements have been made about their fate. On September 23, 2014, the preliminary relief judge of the District Court of East Brabant issued a judgment, published under reference ECLI:NL:RBOBR:2014:5484 .

In 2012, Jumbo took over C1000 and indicated that the C1000 formula will disappear. This obviously has the necessary impact on the C1000 franchisees. The rental rights of the outlets of the C1000 supermarkets of the franchisees have, without their interference, been transferred via legal split to, for example, Ahold, while the C1000 franchise agreement continues to exist.

The Association of C1000 Franchisees (the “Association C1000”) has seen reason to ask the Interim Relief Judge to provide insight into the agreements that Jumbo has made in this regard. The C1000 Association apparently based this on the fact that the C1000 franchisees would be able to (better) assess their legal position based on the requested information.

The Association C1000 had invoked the statutory provision (namely article 843a Rv) that makes an exception to the main rule that someone does not have to hand over the documents held by him to another person for inspection. According to an earlier judgment of the Supreme Court, this rule is not very broad and “does not give a license to demand the unlimited release of documents in order to investigate whether there may be liability for damage”. In particular, it is not the intention that information is demanded, for example, to create a strategic negotiating position. The law therefore explicitly states (in Article 843 paragraph 4 Rv) that a weighing of interests must be made when answering the question whether the documents can be claimed.

The Court finds that the C1000 franchisees whose locations have been transferred by Jumbo to Ahold (and Coop) have been subject to a strategic game at the highest level by Jumbo and Ahold (and Coop), from banks that set requirements for financing by Jumbo of the takeover of C1000 BV and of the NMa, which had to monitor the competition aspects of the takeover. The Court in preliminary relief proceedings is not blind to the difficult position the franchisees have found themselves in.

However, the Preliminary Relief Judge emphasizes that in this case the only question that arises is whether the requested documents should be handed over to Vereniging C1000. The Preliminary Relief Judge refers to the weighing of interests to be made (of Article 843a paragraph 4 Rv) and rules that the Association C1000 has insufficient interest. After all, both the rental agreement with regard to the C1000 location and the franchise agreement will continue to exist. In that respect, strictly speaking, not much will change in the legal position of the C1000 franchisees. The discussion about the apparently intended termination of the C1000 formula is another. The Court in preliminary relief proceedings does emphasize in that regard that the rejection of this claim by the Association C1000 could mean for the individual franchisees vis-à-vis Jumbo and Ahold (and Coop) that they should primarily pursue their own interests towards them .

In that sense, the outcome of the procedure is not surprising, since the commercial agreements between Jumbo, Ahold and Coop, among others, do not have to affect the legal position of the C1000 franchisees.

It is worth noting that if the Association C1000 had initiated the claim to provide the aforementioned openness on the basis of an infringement of the license of the C1000 franchisees, the procedure might have been judged differently. After all, the C1000 franchisees have a license to use the C1000 brands and Jumbo intends to discontinue this, which is apparently part of the agreements with Ahold and Coop. This is important, because the weighing of interests (in Article 843a paragraph 4 DCCP) does not play a role, or at least much less (pursuant to Article 1019a paragraph 3 DCCP), in cases about intellectual property rights.

Mr AW Dolphijn – franchise lawyer

Ludwig & Van Dam Franchise attorneys, franchise legal advice. Do you want to respond? Mail to dolphin@ludwigvandam.nl