Red Robin sues former Amarillo franchisee for retaining menus, decor

AMARILLO - A restaurant on West Interstate 40 continues to operate, at least on the inside, as a Red Robin despite a court order that it stop using the gourmet burger chain's name and proprietary materials.

Red Robin International claims the restaurant lost its right to represent itself under the chain's name more than 18 months ago, when the Colorado company terminated the store's franchise agreement, according to a lawsuit filed in 320th District Court. A hearing in the case is set for Monday.

District Judge Don Emerson signed a temporary restraining order on July 30 mandating Early Bird Amarillo OPS4, the limited partnership that operates the store, cease its use of Red Robin International's trademarked and copyrighted materials.

Exterior signs on the store are covered with blue tarps.

But inside the store Friday, menus and employee apparel still boasted the Red Robin logo. A large Red Robin statue graced the decor, Red Robin seasoning sat on the tables and Red Robin gift cards filled a lobby rack.

Red Robin International is suing Early Bird and Bryan Cumby, a company principal, for allegedly defaulting on the Amarillo store's franchise agreement with the chain. The defendants have challenged the restraining order, which was issued Aug. 1.

Cumby signed a personal guarantee assuming the franchise agreement obligations in May 2010, the lawsuit claims. Attempts to reach Cumby were unsuccessful.

The lawsuit alleges Early Bird and Cumby repeatedly failed to pay franchise fees in a timely manner, resulting in multiple default notices and the chain's termination of the pact in January 2011, court records show.

Red Robin International claims it still had received no payments by January. The chain demanded in a Jan. 23 notice that the store stop operating as a Red Robin and in a July 20 notice that the operator "de-identify" the restaurant as a Red Robin.

A chain representative visiting July 25 discovered the demands had been ignored, the lawsuit states. The operator covered the signs July 27, according to Red Robin International's filing.

"On July 28, 2012, Red Robin learned that the defendants had removed the tarps covering the signage, evidencing the defendants' clear intent to willfully and wrongfully continue to use Red Robin's marks and intellectual property," Red Robin International alleges in the suit.

The chain is seeking unspecified damages.

The restraining order bars Early Bird and Cumby from disclosing Red Robin proprietary information and requires the store scrub the Internet of references to itself as a restaurant in the chain.

A Red Robin in Abilene associated with Cumby closed in June, according to the Abilene Reporter-News. That location's landlord locked the doors because the franchise failed to pay rent, the newspaper reported June 18.

Amarillo store General Manager Mia Jackson declined to comment Friday.

The Texas Secretary of State notified Early Bird Amarillo OPS4 on July 3 that it had failed to file a periodic franchise tax public information report. The state uses the reports to establish assets for franchise tax assessments.

The franchise faced forfeiture of its charter, its right to do business in Texas, if it failed to file the report by Aug. 2, according to the notification.