Priceline Mediation – The Way Forward
Levitt Robinson understands that many Priceline franchisees do not wish ‘to rock the boat’ through litigation and is committed to take all genuine steps to resolve the dispute at pre-trial mediation.
To that end, the firm has approached Tania Murdock Specialist Pharmacy and Franchising Accredited Mediator and winner of the Mediator of the Year, Excellence Award in 2020 (Australasian Law Awards).
Over the last few weeks, the imminent Priceline class action has drawn a lot of media attention, the potential class action is an ongoing dispute with franchisees who claim Priceline has exerted undue control over their pharmacies.
“The Priceline franchisees claim parent company Australian Pharmaceuticals Industries exerts an unacceptable level of control over their business in breach of laws restricting ownership and control of pharmacies to registered pharmacists” (Stephen Price, ‘Chemist Giants are Testing the Rules’, The Australian, 22/02/2021)
“Examples of Priceline’s alleged controlling provisions in the franchise agreements include requirements to stock the Merchandise Range, which is determined by Priceline; place orders through the Auto-Replenishment system; only order through API; and price items as determined by Priceline” (Sheshtyn Paola, ‘Priceline Faces “Imminent” Class Action from Angry Franchisees’, The Australian Journal of Pharmacy, 04/03/2021)
The Priceline franchise agreements contain several provisions that are unlawful, “franchisees have to pay 6 per cent distribution fees on some products sold at a retail price fixed by Priceline, and a further 3 per cent of the proceeds from Priceline’s Sister Club loyalty program. They say they were sometimes forced to sell product at such low margins they made a loss after credit card fees and Sister Club fees” (Stephen Price, ‘High Stakes in Priceline Pharmacy Fight’, The Australian, 21/02/2021)
Commentary from Senior Partner at Levitt Robinson, Stewart Levitt to AJP, “Levitt Robinson understands that many Priceline franchisees do not wish ‘to rock the boat’ through litigation, which is why we are committed to take all genuine steps to resolve the dispute at pre-trial mediation and/or arbitration,” Mr Levitt told AJP.
“The ‘boat is already rocking’: State regulators are already investigating the level of control Priceline exerts on franchisees through the Franchise Agreement and, as a corollary, any contraventions of legislation designed to protect the integrity of the pharmacy profession,” he said. (Sheshtyn Paola, ‘Priceline Faces “Imminent” Class Action from Angry Franchisees’, The Australian Journal of Pharmacy, 04/03/2021)