Professional Documents
Culture Documents
Plaintiff,
v.
Defendants.
Plaintiff Clean Juice Franchising, LLC (“Clean Juice”), for its Verified Complaint, alleges
the following:
1. Clean Juice is a franchisor of juice bar restaurants. Through years of operating and
franchising, Clean Juice developed a confidential and proprietary business method for operating a
juice bar. Clean Juice licenses these proprietary methods to franchisees on the strict conditions that
they pay a royalty for use of the business method, and that they use the business methods only for
who betrayed this fundamental bargain. They closed their franchised restaurants years before
expiration of their franchise agreements, stopped paying royalties, and began using Clean Juice’s
proprietary business methods to operate a competing juice bar at the exact same location of their
former franchised restaurants. Clean Juice therefore brings this action for both an injunction and
PARTIES
3. Clean Juice is a North Carolina limited liability company with its principal place of
4. Clean Juice’s sole member is Clean Juice Holdings, LLC (“Clean Juice Holdings”).
Clean Juice Holdings’ members are six natural persons who are citizens of either North Carolina or
Michigan.
Carolina limited liability company with its principal place of business in Charleston, South
Carolina. Upon information and belief, Charleston Juicing, LLC’s sole member and registered agent
is Roy O. Crain.
South Carolina limited liability company with its principal place of business in Charleston, South
Carolina. Upon information and belief, Charleston Juicing Calhoun, LLC’s sole member and
7. Upon information and belief, Defendant Charleston Juicing Mt. Pleasant, LLC is a
South Carolina limited liability company with its principal place of business in Mt. Pleasant, South
8. Upon information and belief, Defendant Charleston Juicing West Ashley, LLC is a
South Carolina limited liability company with its principal place of business in Charleston, South
Carolina. Upon information and belief, Charleston Juicing West Ashley, LLC’s sole member and
agent of a South Carolina limited liability company, the individual must be a “resident of [South
Carolina].” Accordingly, upon information and belief, Defendant Roy O. Crain (“Crain”) is a
limited liability company with its principal place of business in Collegeville, Pennsylvania. Upon
information and belief, CJ Collegeville, LLC’s sole members are Debra Manchester and Morgan
Manchester.
11. Upon information and belief, Defendant CJ Malvern, LLC is a Pennsylvania limited
liability company with its principal place of business in Malvern, Pennsylvania. Upon information
and belief, CJ Malvern, LLC’s sole members are Debra Manchester and Morgan Manchester.
limited liability company with its principal place of business in Wynnewood, Pennsylvania. Upon
information and belief, CJ Wynnewood, LLC’s sole members are Debra Manchester and Morgan
Manchester.
13. Upon information and belief, Defendant Vogt Goodyear Enterprises, LLC (“Vogt”)
is a Pennsylvania limited liability company with its principal place of business in Collegeville,
14. Upon information and belief, Defendant Debra Manchester is a natural person who
is a citizen of Pennsylvania.
15. Upon information and belief, Defendant Morgan Manchester is a natural person who
is a citizen of Pennsylvania.
16. Upon information and belief, Defendant Richard Kline (“Kline”) is a natural person
17. This Court has personal jurisdiction over the Defendants pursuant to principles of
specific jurisdiction.
18. All Defendants except Kline have consented to personal jurisdiction in this Court.
19. This Court has subject matter jurisdiction of this action pursuant to 28 U.S.C. § 1331
because this action includes claims brought under the laws of the United States.
20. Pursuant to 28 U.S.C. § 1367, this Court has subject matter jurisdiction over the state
law claims in this action because those claims are so related to the federal law claims such that they
form part of the same case or controversy under Article III of the United States Constitution.
21. This Court also has subject matter jurisdiction over this action pursuant to 28 U.S.C.
§ 1332 because, upon information and belief, there is complete diversity among the parties and the
22. Venue is proper in the Western District of North Carolina, Charlotte Division
FACTS
24. Clean Juice is a franchisor that offers and sells franchises for juice bar restaurants.
25. Clean Juice’s restaurants specialize in healthy, organic food and beverage items. The
restaurants’ offerings include smoothies, fresh juices, cold-pressed juices, wellness shots, cashew
milks, cleanses, refreshers, acai bowls, salads, sandwiches, wraps, toasts, and items on a kid’s menu.
26. Clean Juice’s founders opened the first Clean Juice restaurant in 2015.
27. By the end of 2022, Clean Juice had expanded to 123 franchised locations and 11
28. As part of the franchise relationship, Clean Juice grants to its franchisees the right
29. The Clean Juice System is a blueprint for how to operate a juice bar restaurant.
30. By way of examples, the Clean Juice System encompasses methods selecting a
location, constructing the premises, installing signage, implementing Clean Juice’s trade dress,
using the Clean Juice trademarks, furnishing the restaurant with the right equipment, operating the
equipment, managing inventory, controlling ingredient costs, preparing the menu items, navigating
health and safety inspections, and advertising and promoting the restaurant to the public.
31. Clean Juice provides the System to its franchisees through a variety of ways,
including through an Operations Manual (the “Manual”), training materials, and other written
documents.
ongoing royalties in exchange for a license to use the Clean Juice System.
33. The Clean Juice System is not generally known to the public. Clean Juice only shares
34. Clean Juice has taken reasonable measures to keep the Clean Juice System secret.
For example and without limitation, Clean Juice requires its franchisees to sign confidentiality
agreements, hosts the Manual and other System documents on a password-protected website, and
35. Crain was the owner of three franchised Clean Juice restaurants in the South
Carolina Lowcountry.
36. In 2017, Crain’s company Charleston Juicing, LLC entered into three separate
Juice restaurant in Mt. Pleasant, South Carolina (attached hereto as Exhibit 1).
Upon information and belief, Crain operated this franchise through Charleston
Juicing Mt. Pleasant, LLC, even though that entity was not a signatory to the
conduct, the parties modified the Mt. Pleasant Franchise Agreement to make
Juice restaurant in the West Ashley area of Charleston, South Carolina (attached
hereto as Exhibit 2). Upon information and belief, Crain operated this franchise
that by their conduct, the parties modified the West Ashley Franchise Agreement
Exhibit 3). Upon information and belief, Crain operated this franchise through
Charleston Juicing Calhoun, LLC, even though that entity was not a signatory
to the written franchise agreement. Clean Juice alternatively alleges that by their
37. Each of the Charleston Franchise Agreements had a 10-year initial term from the
effective date.
38. For each of the Charleston Franchise Agreements, Crain signed an Owner’s
Guaranty and Restriction Agreement (an “Owner’s Guaranty”) and personally guaranteed payment
39. Debra and Morgan Manchester were the owners of three franchised Clean Juice
40. Effective June 1, 2018, the Manchesters’ company Vogt Goodyear Enterprises, LLC
entered into a Multi-Unit Agreement with Clean Juice that gave Vogt Goodyear Enterprises, LLC
the right to develop three separate Clean Juice franchised restaurants (the “MUA,” attached hereto
as Exhibit 4).
42. Effective July 6, 2019, the Manchesters’ companies entered into three separate
5).
7).
43. Each of the Philadelphia Franchise Agreements had a 10-year initial term from the
effective date.
44. For each of the Philadelphia Franchise Agreements, the Manchesters signed an
Owner’s Guaranty and personally guaranteed payment and performance under the franchise
agreement.
45. In return for the right to use the Clean Juice System, the franchisees made several
46. The franchisees had to keep their restaurants “open and in normal operation” for the
hours and days Clean Juice specified. (Franchise Agreements § 8.2). If the franchisees “cease[d] to
Juice could terminate the franchise agreement immediately upon notice. (Id. § 16.2.1).
47. The franchisees were required to pay ongoing royalty, brand fund, and technology
fees to Clean Juice. (Id. § 5). If the franchisees failed to pay those fees and did not cure that monetary
default within five days’ notice, Clean Juice could terminate the franchise agreements immediately
48. The franchisees agreed to use the Clean Juice System “only for [their] Franchised
Business and to perform under this Agreement” and not “for the benefit of any other person,
persons, partnership, association, or business entity.” (Id. § 11.3). They also agreed that any “use
or duplication of the Franchised System other than as permitted under this Agreement will constitute
49. The franchise agreements prohibited the franchisees from competing with Clean
You covenant that during the term of this Franchise Agreement you will
not, either directly or indirectly, except as otherwise approved in writing by
us, for yourself, or through, on behalf of, or in conjunction with, any person,
persons, or legal entity, directly or indirectly (including through an act of
omission), divert or attempt to divert any business or customer of your
[Franchised] Business to any competitor by inducement or otherwise . . . .
(Id. § 18.2).
50. If the franchisees breached this in-term covenant, Clean Juice could terminate the
authorized Clean Juice to terminate a franchise agreement if the franchisee or its affiliate defaulted
the event the franchise agreements expired or were terminated. Those post-termination obligations
include:
a. The franchisees must return to Clean Juice “all originals and copies of the
b. The franchisees must “immediately and permanently cease to use, in any manner
c. In the event the franchise agreements were terminated early due to the
franchisees’ breach, the franchisees must pay liquidated damages in the amount
of “the average monthly Royalties payable to us for the twelve months preceding
(Id. § 18.3).
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and performance under the franchise agreements, Crain and the Manchesters also agreed to be
54. Each of the Philadelphia franchisees permanently closed their franchised Clean
55. On or around November 2, 2023, each of the Philadelphia franchisees opened a juice
bar called “CraveWell Café” at the same locations in Collegeville, Malvern, and Wynnewood where
56. The CraveWell Café concept is nearly identical to the Clean Juice concept.
57. The Manchesters’ and the Philadelphia franchisees’ ownership and operation of
CraveWell Café violated the in-term covenants in Sections 18.2 of the Philadelphia Franchise
Agreements.
58. On October 17, 2023, Clean Juice sent a letter to each of the Philadelphia franchisees
immediately terminating their franchise agreements. Those letters are attached to this Complaint as
59. On or around April 28, 2023, the West Ashley franchisee permanently closed its
60. Beginning on October 25, 2023, the downtown Charleston and Mt. Pleasant
franchisees ceased making required royalty, brand fund, and technology fee payments to Clean
Juice.
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franchisees a notice of monetary default with an opportunity to cure within five days. Those default
62. The downtown Charleston and Mt. Pleasant franchisees did not cure those monetary
defaults.
63. The downtown Charleston and Mt. Pleasant franchisees permanently closed their
64. On or around November 28, 2023, the downtown Charleston and Mt. Pleasant
franchisees opened a CraveWell Café at the same locations in downtown Charleston and Mt.
65. Crain’s and the Charleston franchisees’ ownership and operation of CraveWell Café
violated the in-term covenants in Sections 18.2 of the downtown Charleston and Mt. Pleasant
franchisees agreements.
66. On December 6, 2023, Clean Juice sent a letter to the downtown Charleston and Mt.
Pleasant franchisees terminating their franchise agreements. Those letters are attached to this
67. Notwithstanding the termination of their franchise agreements, the Charleston and
68. In violation of § 11.3, neither the franchisees nor the guarantors have returned to
69. Upon information and belief, in violation of § 17.2, the franchisees and their
guarantors have continued to use the proprietary Clean Juice System to operate CraveWell Café.
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71. In violation of § 18.3, the franchisees and their guarantors continue to operate their
CraveWell Café restaurants at the same premises where they previously operated their franchised
73. Clean Juice provided training to Kline on how to implement the Clean Juice System
74. Kline previously worked as an independent contractor for Clean Juice. In that role,
75. Upon information and belief, in early 2023, the Philadelphia franchisees hired Kline
as an employee or independent contractor to assist in the operation of their Clean Juice restaurants.
76. Upon information and belief, Kline used the proprietary Clean Juice System to
develop a business plan for CraveWell Café and to orchestrate the Philadelphia and Charleston
77. Upon information and belief, Kline is using Clean Juice’s proprietary System to
78. Upon information and belief, Kline induced the Charleston and Philadelphia
franchisees to violate their franchise agreements so that Kline could manage the CraveWell Café
venture.
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80. The franchise agreements constitute valid contracts between Clean Juice, on one
hand, and the Charleston franchisees and Philadelphia franchisees, on the other hand.
81. Clean Juice fully performed its obligations under the franchise agreements.
82. The franchisees breached their obligations under the franchise agreements by,
a. Failing to keep the restaurants open and in normal operation for the specified
c. With respect to the downtown Charleston and Mt. Pleasant franchisees, failing
to pay required royalty, brand fund, and technology fees as required by Section
5 of the franchise agreements, and further failing to cure those monetary defaults
d. Except for the West Ashley franchisee, operating CraveWell Café in violation
agreements;
e. Violating the confidentiality provisions set forth in § 11.3, 17.2 of the franchise
agreements;
agreements; and
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no remedy at law. Clean Juice is therefore entitled to an injunction to enforce the Franchise
Agreement.
84. These breaches have proximately caused Clean Juice to suffer damages in an amount
to be determined at trial.
85. Clean Juice re-alleges and incorporates by reference each of the above paragraphs.
Philadelphia Franchise Agreements constitute valid contracts between Clean Juice, on one hand,
and Crain, Debra Manchester, and Morgan Manchester, on the other hand.
87. Clean Juice fully performed its obligations under the Owner’s Guaranties.
88. Crain has breached his obligations under the Owner’s Guaranties by, among other
things:
in fact, causing the franchisees to fail to perform under the franchise agreements;
b. Failing to pay Clean Juice money the franchisees owe under the franchise
agreements and, in fact, causing the franchisees to fail to pay all monies owed
89. Crain’s and the Manchesters’ breaches are causing Clean Juice to suffer irreparable
harm for which there is no remedy at law. Clean Juice is therefore entitled to an injunction to enforce
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91. Clean Juice re-alleges and incorporates by reference each of the above paragraphs.
92. The MUA constitutes a valid contract between Clean Juice, on one hand, and Vogt
93. Clean Juice fully performed its obligations under the MUA.
94. Vovt Goodyear Enterprises, LLC breached its obligations under the MUA by,
among other things, failing to keep open and failing to continue to operate the Philadelphia
95. Vogt’s Goodyear Enterprises, LLC’s breaches have proximately caused Clean Juice
96. Clean Juice re-alleges and incorporates by reference each of the above paragraphs.
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the public or by persons who can obtain economic value from their disclosure or use.
100. Clean Juice took reasonable efforts to ensure the secrecy of the trade secrets.
101. The trade secrets were specifically identified as trade secrets in the Franchise
Agreement.
102. Upon information and belief, Defendants are using those trade secrets to operate
CraveWell Café.
104. Defendants have acquired, disclosed, or used Clean Juice’s trade secrets without
105. Defendants’ conduct is willful and malicious because, among other things, their
conduct was expressly prohibited by the Franchise Agreements and hidden from Clean Juice.
106. Defendants’ misappropriation of Clean Juice’s trade secrets has caused Clean Juice
to suffer irreparable harm for which it has no adequate remedy at law. Clean Juice is therefore
secrets.
107. Defendants’ misappropriation of Clean Juice’s trade secrets has proximately caused
108. Clean Juice re-alleges and incorporates by reference each of the above paragraphs.
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111. The trade secrets derive commercial value from not being generally known or
the public or by persons who can obtain economic value from their disclosure or use.
112. Clean Juice took reasonable efforts to ensure the secrecy of the trade secrets.
113. The trade secrets were specifically identified as trade secrets in the Franchise
Agreements.
114. Upon information and belief, Defendants are using those trade secrets to operate
CraveWell Café.
116. Defendants have acquired, disclosed, or used Clean Juice’s trade secrets without
118. Defendants’ conduct is willful and malicious because, among other things, their
conduct was expressly prohibited by the Franchise Agreement and hidden from Clean Juice.
119. Defendants’ misappropriation of Clean Juice trade secrets has caused Clean Juice to
suffer irreparable harm for which it has no adequate remedy at law. Clean Juice is therefore entitled
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121. Clean Juice realleges and incorporates by reference each of the above paragraphs.
122. The Franchise Agreements and Owner’s Guaranties are valid and enforceable
contracts.
123. Kline knew of the existence of the Franchise Agreements and Owner’s Guaranties
124. Upon information and belief, Kline, for his own benefit, intentionally, maliciously,
and without any privilege to do so, induced the franchisees, the Manchesters, and Crain to breach
126. Kline’s interference was conducted through improper means, including but not
127. Kline’s conduct has proximately caused Clean Juice to suffer damages.
128. Clean Juice realleges and incorporates by reference each of the above paragraphs.
129. Defendants’ acts of misappropriation of trade secrets and tortious interference with
contract, as set forth above, constitute unfair and deceptive trade practices.
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133. Clean Juice is entitled to treble damages pursuant to N.C. Gen. Stat. § 75-16.
134. Clean Juice is entitled to recover its reasonable attorneys’ fees and costs pursuant to
135. Clean Juice realleges and incorporates by reference each of the above paragraphs.
136. All of the Defendants agreed to engage in unlawful activity, including but not
limited to:
c. Tortiously interfering with Clean Juice’s contracts with its franchisees and
owners; and
d. Violating the North Carolina Unfair and Deceptive Trade Practices Act.
ARBITRATION DEMAND
Except for any actions brought with respect to (i) the [Proprietary] Marks
or (ii) securing injunctive relief or specific performance under this
Franchise Agreement, any claim or controversy arising out of or related to
this Franchise Agreement, or the making, performance, breach,
interpretation, or termination thereof, including any claim or controversy
involving any and all of our shareholders, officers, and directors in their
individual capacity, will be finally settled by arbitration to be conducted in
accordance with this Franchise Agreement.
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franchise agreements and stop Defendants’ misappropriation of Clean Juice’s trade secrets.
140. Following the preliminary injunction proceedings, Clean Juice demands arbitration
JURY DEMAND
(In the Alternative)
141. To the extent that for any reason the parties litigate these claims in court rather than
secrets.
B. Enter judgment for Clean Juice and against Defendants on all causes of action.
F. Tax the costs of this action, including reasonable attorneys’ fees, against
G. All such further relief that the Court or Arbitrator deems just and proper.
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