NEW ORLEANS Businessman Larry Lundy, a longtime owner of the Pizza Hut franchise stores in the New Orleans area, has filed suit against the company, alleging they reneged on an arbitration award that would have cost the company millions in payments to him.
Lundy, CEO of Lundy Enterprises, was ordered to close his stores on Jan. 2 when Pizza Hut terminated his franchise agreements, according toLundy.
All Pizza Hut stores in the metro area remain shuttered.
In the suit, Lundy alleges he is due about $8 million from an arbitration award that the two parties had agreed to.
Lundysaid Pizza Hut later reneged on the deal and terminated Lundy's franchise agreements.
Prior to closing Lundy's stores, the Pizza Hut corporation filed a federal lawsuit in Texas against Larry Lundy and Lundy Enterprises, claiming they failed to pay royalty and advertising fees on time.
The lawsuit says there was an attempt to settle the dispute with a sale of Lundy assets to Pizza Hut, but that didn't work out and Lundy lost the right to operate the Pizza Hut restaurants as of Sunday.
Lundysaid the suit alleges that Pizza Hut had burdened Lundy by imposing unfair credit terms, refusing to permit him to introduce product line extensions and trying to scheme to reclaim his territory for itself.
