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Conflict of Laws Keyed to Brilmayer
Banek, Inc. v. Yogurt Ventures U.S.A., Inc.
Citation:
6 F.3d 357 (6th Cir. 1993)Facts
Plaintiff, Banek, Inc., was a Michigan corporation owned by Mr. and Mrs. Banek. Defendant, Yogurt Ventures U.S.A, Inc., was a Georgia corporation owned by John and Richard Stern. Banek and Yogurt Ventures entered into negotiations to purchase a Freshens Yogurt franchise that would be located in Monroe, Michigan. In February 1990, the parties signed a “Franchise and Development Agreement” that included a choice of law provision.
In October 1991, Banek filed suit in state court against Yogurt Ventures for breach of contract, violations of the Michigan Franchise Investment Law, violations of the Federal Trade Commission Franchise Rules, common law fraud and misrepresentation, and negligence. In March 1992, Banek closed its Freshens franchise. In May 1992, Banek filed a separate action against John and Richard Stern.
The two cases were consolidated and removed to federal court based on diversity jurisdiction. The district court granted the Defendants’ motion to dismiss the case, and the district court granted in part and denied in part. The district court found that the choice of law provision in the agreement, providing that Georgia law is to govern the rights and obligations of the parties, was valid and enforceable under Michigan law. Plaintiff, Banek, Inc., appealed on the ruling concerning the choice of law provision.
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