The chain has allowed regional managers to profit off immigrants and minorities, the suit says.
. Now, a new explosive lawsuit filed by a former Subway franchisee is putting the spotlight on the chain's inner turmoil yet again., the lawsuit filed by Raj Mehta in Nevada state court last month outlines systemic exploitation of franchise owners, many of whom are immigrants, by Business Development Agents . These regional managers who are franchisees themselves prey on new operators' naivete and push them into financial ruin, the suit claims.
Subway is proud of its diverse franchisee network. Our current recruitment strategy focuses on attracting experienced franchise operators with strong business acumen and providing them with the tools and support needed to grow their business and ensure long-term success.
In particular, the lawsuit names Chirayu Patel as one of the BDAs who used dirty tactics for his own profit. Patel, who was the BDA for the plaintiff's Subway restaurants and owned a fleet of his own locations in the same territory, would send"hit men" with the goal of finding violations at franchisee's restaurants. Once written up, these operators would face fines and higher royalty rates, pushing them to the brink of bankruptcy.
The lawsuit accuses Patel of racketeering and taking over one of Mehta's shutdown restaurants, which he then resold for his own profit.. The chain confirmed his Northern California and Reno, Nevada territories were transitioned to"a new group who is well-regarded in the Subway network and known for delivering operational excellence.", the chain has also begun to phase out the BDA system and has started to oversee some territories themselves.
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