The Post has learned that the owners of a Subway sandwich shop in Brooklyn prevented the loss of their successful franchise by using surveillance footage to stem the bogus allegations.
According to legal filings obtained by The Post, a Subway inspector claimed the shop did not bake or mop fresh bread overnight, with brothers Meena and George Hanna being dragged into a possible arbitration hearing by the country’s largest fast-food chain. Was stunned. ,
Subway, which owns the brand but none of its nearly 21,000 U.S. locations, has come under fire for violent practices by its development agents targeting mom-and-pop franchisees, which allow them to commit minor infringements. Seems like they can take away and resell their restaurants and collect more fees, The Post has previously reported.
HBO host John Oliver slammed the company for the way it treated its franchises during the May 22 episode of “Last Week Tonight with John Oliver”—a clause that forced the company into damage control.
Subway said Oliver based its segment on old facts and changed its practices when it named John Chidsey as the first non-Founding Family CEO on November 18, 2019.
The Post reported in May 2019 that Subway took 718 legal actions against its franchisees in 2018 and 955 in 2017. Compared to less than 10 per year during that time filed by McDonald’s, Burger King and Wendy’s.
At the time, a Subway spokesperson said monthly inspections were “making sure to meet the high standards we demanded and expected by guests.”
Last year, Subway took only 13 actions against franchisees, according to federal filings.
The half-hearted allegations against Hannas — which came days after Chidi took over — surfaced in a separate lawsuit brought by franchise owners against the Connecticut-based company after the video helped save their restaurant.
Young expatriates from Egypt opened their franchise in January 2019 on an MTA-owned property in Bensonhurst, near An N train station.
Less than a year later, Subway Inspector Aaron Near—area manager working for Restorex (also known as a development agent)—came in to see if they could handle the nearly 800-page operation. are complying with the manual.
Near claimed that the store was not making fresh bread daily, a requirement for all franchisees. According to court filings, the shop typically makes 70 to 80 sandwiches a day.
He took a picture of an empty bread cabinet, which was proof that no bread was being prepared.
However, the brothers had their own security cameras on the premises, telling a different story, said a source familiar with the situation.
Video shows Nearby watching an employee roll out dough on a cutting board to bake batches of 50 loaves of bread on November 21, 2019, said the source, sharing security camera footage with the post.
“While checking [my] It was clear from the cameras that this person was causing me to fail in ways that were literally impossible,” Mina Hanna said in a January 2022 Connecticut Supreme Court action against Subway, explaining that she only made 50 loaves of bread at a time. can cook.
“He was mad as he stood in front of another batch of bread baking, but actually waited for my staff to take a picture of the empty rack he used to evaluate his made thawed bread. will remove.”
Near also told that no one had cleaned the shop the night before. Nevertheless, there was a security camera video from November 20, 2019, which showed a worker mopping up, based on screenshots reviewed by The Post.
Nier declined comment, citing The Post to Restorex. The development agent declined to comment.
Subway found the brothers out of compliance and prepared to take Hannas to arbitration — putting them at risk of losing their store — until they sent surveillance footage to Subway case manager Sharon Ruck-Folgren, the source said. .
After reviewing the video, Subway closed all legal proceedings against the brothers, saying their shop was in compliance.
“Franchise is the key to our success – when they succeed, we succeed,” a Subway spokesperson told The Post. “That is why our new leadership team is focused on fostering ongoing support and positive relationships with our dedicated network of franchisees. As part of this effort, we are transitioning to independent, third-party assessments to help franchisees their In the example you reference, there was an inspection error that we have corrected.”
Subway enforces a comprehensive non-disparity clause in its franchise agreements that prevents franchisees from criticizing the brand. Hannas declined comment for this story, saying they did not want to break the segment.
But after saving his franchise, Hannas still took the fast-food giant into arbitration, claiming that the company denied him the opportunity to open a more elaborate Subway cafe at his Bensonhurst location. Subway Cafe tends to have “upscale décor” like upholstered seats and a larger menu than a traditional branch.
The Connecticut suit said shortly after Hannas signed the lease with Subway and the New York City Metropolitan Transportation Authority in 2017, company brass claimed it was discontinuing the concept.
The decision forced the brothers to pay for new architectural plans and pay rent, delaying the restaurant’s opening.
“I … [wasted a year filing new design plans and] Spent over $60,000 in rent,” Mina Hanna said in a court filing.
But in February 2020, Hannas learned that Restorex had opened a Subway cafe in November 2019, Connecticut Suites said.
“I was being singled out,” Hannah said in the filing.
Hannas took Subway to arbitration to recover past fares.
The brothers lost their case after the American Arbitration Association ruled in favor of Subway on December 16, 2021, saying Hannas had no contractual right to operate the cafe.
To put salt on the wound, Hannas had to pay an arbitration court about $20,000 to hear his case, the court filing said.
He appealed the decision by going to the Connecticut Supreme Court to vacate the arbitration. But on March 25, the court ruled that they missed the 30-day deadline to challenge the arbitration decision – because they filed their case three days too late.