"To the best of our knowledge, this is the first time that spouses who are not directly involved in a franchise have sued a franchisor," said Susan P. Kezios, President of the American Franchisee Association. Collectively, the four New Jersey plaintiffs lost initial investments exceeding $150,000 and owe Snap-on over $715,000.
The lawyers representing the plaintiffs say the economic challenges facing Snap-on franchisees are underscored by very high dealer losses and turnover in its network. “Through our discovery process, we learned that in the company's Eastern Region in 2002 alone, dealers sustained $2.9 million in losses. Further, a high turnover rate caused 387 dealers to leave the business during the 2000-2002 period, being replaced by only 377 new dealers."
A group of women have formed WASO (Wives Against Snap- on), which has established a website, www.snap-onfranchisefraud.com.