RFG denies Michel’s Patisserie class action allegations

By Sarah Stowe | 19 Oct 2021 View comments

Frozen cakes are back in the spotlight as RFG denies allegations made by a former Michel’s Patisserie franchisee in a class action before Federal Court.

A statement from the multi-brand franchisor says it is currently reviewing the allegations, which refer to historical operations and conduct under former RFG leadership.

The class action is over a 2015 change in product supply when RFG stopped supplying fresh cakes to franchisees and delivered frozen items instead.

The franchisees in the class action believe the ‘fresh to frozen’ model was a breach of the franchise agreement, Australian Consumer Law and the Franchising Code of Conduct.

According to the RFG chairman-approved announcement, the class action applicant is seeking damages, declarations, interest and costs on behalf of the representative group.

“It is not currently possible for RFG to quantify the financial implications of the
outcomes being sought against it in the proceedings,” the statement reads.

“That said, the company is denying the allegations raised against it and its related entities, and will be defending the proceedings.”

The Michel’s Patisserie class action will have come as no surprise to RFG – it has been raised in its past accounts.

The prospect of legal action was flagged back in 2019 when law firm Corrs Chambers Westgarth first announced the possibility of filing a lawsuit on behalf of disgruntled former and current franchisees.

Since then, and separately, the Australian Competition and Consumer Commission has taken on the food franchisor, alleging misuse of, and a failure to disclose to franchisees relevant information about, the marketing funds.

In April executive chairman Peter George said the business would rebut the ACCC allegations.