The Franchise Memorandum

A federal court in North Carolina has granted a quick-service restaurant franchisor’s motion to dismiss allegations that it violated the Americans with Disabilities Act (ADA). Chapman v. CKE Rests. Holdings, Inc., 2020 WL 1230130 (E.D.N.C. March 12, 2020). Chapman, a quadriplegic, alleged that CKE violated the ADA by denying her full and equal access to one of its restaurants where “she experienced unnecessary difficulty and risk due to excessive slopes in a purportedly accessible parking area.” Chapman alleged that she desires to return to that restaurant in the future, but is deterred by CKE’s noncompliance with the ADA. Chapman also alleged that CKE employed “centralized policies, practices, and procedures with regard to the design, construction, alteration, maintenance and operation of their facilities,” and that, as a result of these centralized policies and practices, CKE had “systematically and routinely violated the ADA by designing, constructing, and altering facilities so that they are not readily accessible and usable, by failing to remove architectural barriers, and by failing to maintain and operate facilities so that the accessible features of [CKE’s] facilities are maintained.” Chapman sought a declaratory judgment, a permanent injunction, class certification, payment of the costs of suit, and reasonable attorneys’ fees. CKE moved to dismiss the case for lack of standing.

The court held that Chapman lacked standing to bring the action because she failed to allege either that CKE itself had caused her injury or that CKE was the proper party to remedy that injury. The court found that Chapman had failed to adequately allege causation because she failed to allege facts showing (1) that CKE — rather than a third party, such as a franchisee — controlled the premises at issue or (2) that any “excessive sloping” at the premises was the result of any CKE policy or lack thereof. For the same reasons, the court found Chapman had failed to allege sufficient facts to show that CKE was in a position to remedy the alleged harm. Accordingly, the court dismissed the complaint without prejudice.