Wireless Toyz trial over franchisee lawsuits underway

The Abbo case is one of at least three pending lawsuits against Barbat and his company by franchisees that claim they each invested hundreds of thousands of dollars to open one or more Wireless Toyz locations.

Crain’s Detroit Business
February 15, 2010

Wireless Toyz trial over franchisee lawsuits underway
Chad Halcom

Plaintiff attorneys could rest their case and defense trial testimony could begin later this week in a lawsuit against Farmington Hills-based Wireless Toyz Inc. and founder-president Joe Barbat alleging fraud and violations of Michigan franchise laws.

Trial testimony continued Friday and is expected to resume Tuesday before Oakland County Visiting Judge Steven Andrews, in the lawsuit brought by Colorado Toyz Inc. and Colorado franchisee David Abbo.

The Abbo case is one of at least three pending lawsuits against Barbat and his company by franchisees that claim they each invested hundreds of thousands of dollars to open one or more Wireless Toyz locations.

A second lawsuit by former franchisee Raad Kello of 75th/Grand Inc. of suburban Chicago awaits a trial date in September; a third by Lubbock, Tex.-based franchisee Susanne Moore of Pita Enterprises L.L.C., was removed from Oakland County to U.S. District Court in Detroit last December.

Bradley Schram, founding shareholder at Bloomfield Hills-based Hertz Schram P.C. and attorney for Wireless Toyz , said he expects the defense could seek for directed verdict in its favor as early as Wednesday, after plaintiff testimony concludes. If that motion fails, defense testimony begins.

“There was no fraud involved in any of the franchises,” Schram said. “The market has just changed, just like many industries are dealing with a market that changes.”

Wireless Toyz began franchising in late 2001 and claims about 200 locations nationwide. Barbat was a Crain's 40 under 40 honoree in 2005.

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