Aussie Pet Mobile Inc ripoff franchisees fraudulent claims unethical, mafia and illegal business practices Dana Point California

One of these Aussie Pet Mobiles sent a letter to all who they had served this month stating they are closing as of March 1, 2004. I cannot say that I am sorry to see them go, as they worked on my miniture chow chow and butchered his coat, to this date there are still areas on his fur that have NOT grown back, they clipped him almost to bare skin when they worked on him. He is losing fur around his collar area , this all started after they worked on him last summer.

In calling the offices I got run about , shallow responses. I was given one free grooming appt after that , which even the woman who claimed to be the owner, did a very shotty job.

If Aussie cannot treat franchisees right, train them well, they ought not be in business ANYWHERE.

The UFOC is written strongly in favor of the franchisor. The gentleman that wrote it is a very good franchise attorney. Ian knows what he is doing.

There are two generations of franchisees. The first set for the most part is probably gone. They were awarded their franchises in 2000 by "Master Franchisors". The "Master Franchisors" had purchased the rights to sell franchises in specific geographic areas (i.e. Los Angeles County territory cost $100,000 with the ability to award one franchise per 25,000 population). The model did not work then and thus the majority if not all of the franchisees are gone. The "Master Franchisors" are gone also. They were purchased back by the franchisor with the agreement that cash would be paid as the franchisor sold franchises in their territories.

Business brokers were then brought in to sell "Area Developers". The price went up to afford the increased commissions needed to pay the brokers(price was $25000). This is the second generation of franchisees.

From what I can see, the model has not changed.

In 2000, the model was based on 8 dogs per day. It appears that expectations have been lowered to 6.5 dogs.

Unless you have the money to sue, it makes more sense to walk away.

The one possible thing that could be done is to call California's Department of Corporations and ask them to investigate the concerns.

Note - when a franchise is canceled or terminated, the franchisor must disclose why it was terminated or canceled. If false information was filed with the state, the franchisor has a problem.

Hi, I am Chris Klike and I DID NOT post my email to Lou Vince that was posted by someone on 4/14/2003. Neither did I authorize anyone to post this email. I did forward the email and I believe that I now know who this individual is.

As noted, I have had a difference of opinion with APMI management. However, I called Ian on Monday when I noticed that someone had posted my email to advise him that It wasn't me that posted the email.

Ian and I are now on amiable terms. I have a choice to stay in the APM Franchise system or sell my territory back.

I must say that if I had approach Ian directly; we would have never clashed. I would also advise others to come out in the open and confront Ian. I think that you will be surprise.

I may not stay in the franchise system but it is more due to personal and financial consideration than the quality of the franchise.

There are things that need to be fixed with the APM system. But after my discussion with Ian, I believe that APMI have remedial actions in place and are working as fast as possible to implement them.

Again, I advise all who haven't to contact Ian with your concern and start an open dialog.

From the legal opinion posted above and the following responses, it looks to me like Mr. Ian and his attorney are obviously making good use of the marketing fund by defending their "brand" with lawsuits. That is probably why they had to cut out the yellow pages. I see potentially three lawsuits in this series of reports where Aussie Pet Mobile is suing franchisees for slander, and without a second thought saying potentially slanderous things about the original complaintant.

What kind of brand are they building? Don't they realize that franchisees are as much customers as the people who pay to have their dogs washed?

Here is a letter I got in my email, showing another poor franchisee getting the shaft.
________________________
I wished you had joined earlier and maybe I'd still be in the APM franchise group.

Ian called my wife yesterday extremely upset with me. It seems that he had taken exception to my participation in the Yahoo! Group.

He had actually found out who "imafrogdog" was. I knew that it could be done but I didn't think they'd take the time or energy to find it. Quite obviously, APM corp. wants NO public criticism.

I called Ian as he requested and we had a pretty heated conversation and a one point I had to tell him that "he was threatening the wrong boy"!

Shortening a long story, I'll be leaving the APM family. Some at Ian's insistence and some at my own resolve. I don't believe in the validity of the business model as it stands and I really don't like Ian's tactics. More importantly to me, I am not going to told to be a good franchisee and "keep my mouth shut".

He said that two or three franchises are disgruntled (more like eight or ten that are vocal and God Knows how many are running silent). I said that I know people in Texas that aren't happy with APM corp. Ian, in true form, said how about "so and so in Austin" or Stacey Magee in Arlington and I just said "Ian, I'm ain't tellin' you who it is".

I feel that if you are seen as rebel; he'll single you out. Ian tried to pin me as a coward for not confronting him. I attempted to convince him that I was just trying to figure out what the "hell" was going on. I further rebutted that it was his responsibility to quench the fire and make a public statement, which they finally did yesterday.

Additionally, it would seem that they would be more concerned with monitoring my progress and helping me become a successful franchise than policing a Internet Webgroup. You spend your energies on what are important to you and it is more important to be policing the Internet for APM corp than helping struggling franchises.

I am glad that you are doing well and I really hope that all APMFs will prosper and flourish. I am truly disappointed in APM corp and Ian. I have owned my businesses before and was very successful. I have also 30 years of successful corporate business experience. My wife owns three Curves for Women, which are all quite successful. So, I know a little bit running a successful business and how a successful franchise should work (and not work). In my discussion with Ian, when I'd bring up valid issues (exorbitant royalty rates, poor trailer quality, no yellow pages anymore), he'd say "with your attitude" we don't want or need you as a Franchisee. I know that I am outspoken and that's in my nature. But it seems that this franchise will be run more like a totalitarianistic regime than an open and honest democracy. I agree with Ben (Bendover) that this is America and d**n it we have a right to freely express our opinion in public without corporate retribution.

You invited people to email directly so I am. I would be curious about your thoughts on how I have been treated. I have NOT been the angry Webgroup participant. I have been inquisitive, offered my experience with APM so far and obviously offered my opinion at times. But to be asked to leave a franchise group because I said " it seems that the corporate ship has hit an iceberg and is taking on water" in a Internet Webgroup is both baffling and unjust.

Please keep my correspondence between you and I. I want no more battles with Ian.

Look forward to your response.

Sincere Regards,

Chris Kline
Owner APM North West Harris County, Houston, TX.

"Jim" - the person who posted most of the negative comments about Aussie Pet Mobile above - is James Anderson, a former Aussie Pet Mobile franchisee.

Last year, in a fit of anger, he published the same comments, or substantially the same comments, to his fellow franchisees by e-mailing them. Shortly after that, he sent the following e-mail to all of his fellow-franchisees:

From: "Jim Anderson"
To: [list of franchisees]
Sent: Friday July 19, 2002
Subject: Apology

I apologize for the e-mail I sent out on July 15, 2002. I retract my statements regarding Ian Moses and Aussie Pet Mobile, Inc. that impugned the ethics and/or honesty of Aussie Pet Mobile, Inc., its employees and/or its president, Ian Moses. The termination of my franchise agreements was due to my own acts and fault. In fact, Aussie Pet Mobile, Inc. and Ian Moses have taken steps to assist me in avoiding financial loss.

Thanks,
Jim Anderson

Maybe readers of the current comments will understand Mr. Anderson's opinions more clearly in light of this erratic history. We do not know why Jim has chosen this time, so long after he acknowledged that he caused his own problems, to have another outburst and to go on the attack again. Perhaps he will publish another apology, although we understand that RipOffReport.com, which uses an off-shore site and is apparently beyond the jurisdiction of the United States courts, does not allow retractions or apologies, even if they are true and set the record straight.

Aussie Pet Mobile, Inc. remains thankful that its franchise agreement is a competent and modern franchise agreement substantially similar to the franchise agreements of other leading franchise systems; and that its system is the finest pet grooming system anywhere.

Here is what happened to the author of the open letter to Ian Moses:

We regret to report that, effective April 7, 2003, Richard Moore has left the Aussie Pet Mobile System of franchisees. Pursuant to a confidentiality agreement between us, neither we nor Mr. Moore is permitted to make any statement regarding his relationship with Aussie Pet Mobile, Inc., nor the reasons for his departure. We request that no inquiries be directed to either him or us. We wish him the best in his new endeavors.

I am including the problems with this franchisors Franchise Agreement. These were in existence in 2001, and may have been revised:

1.The California legislature has enacted two statutes to protect prospective purchasers of franchises in California, the Franchise Investment Law and the Franchise Regulations Act.

APM has chosen to avoid if at all possible compliance with some of the significant provisions of both statutes. It's Unit Franchise Agreement does not comply with the FRA and it requires you to waive significant benefits provided to you under the FIL. Even though APM acknowledges that certain provisions in its Unit Franchise Agreement may be voided by California law, nonetheless in unequivocal terms, it advises you that " ... we intend to fully enforce all of the provisions you sign (including the franchise agreement) ..."

2. You will have signed a GENERAL RELEASE which is attached as the FOURTH SCHEDULE to the Unit Franchise Agreement. By this release, you will forever release and discharge APM of any and all causes of action, in law or equity, suits, debts, liens, defaults under contracts, leases, agreements or promises, liabilities, claims, damages, losses, cost of expenses, of any nature whatsoever however arising, known or unknown, fixed or contingent, past or present, THAT YOU NOW HAVE OR MAY HEREAFTER HAVE AGAINST APM AND ANY RELATED PERSONS BY REASON OF ANY MATTER, CAUSE OR THINGS WHATSOEVER FROM THE BEGINNING OF TIME TO THE DATE OF THE EXECUTION OF THE RELEASE. This agreement wipes away any rights you have under the FIL to sue APM or its officers. (What possessed franchisees to think that this wasn't a serious problem? APM can do anything to you short of being criminal and get away with it now, legally. The only way to challenge this is to litigate. Using the Arbitration forum they offer gives them ALL the power and is kept hidden and secret from the legal system, and therefore other prospective franchisees.)


3. The default provisions of the Unit Franchise Agreement present the same issue as described above. Section 25.3 of the Unit Franchise Agreement provides that your Unit Franchise Agreement can be immediately and automatically terminated on delivery of notice of termination or on three calendar days after mailing of a Notice of Termination WITHOUT ANY OPPORTUNITY TO CURE if you violate any of 10 specified provisions. Most of these provisions violate Business & Professions Code 20021, which is part of the FRA. This code permits the franchisor to provide an immediate notice of termination of the franchise without the opportunity to cure, but on very narrow, specifically defined terms. Subdivisions (f), (g), (h), (i), and (j) of Section 25.3 are not permitted conditions for immediate termination under this code. It does permit immediate termination if the franchisee abandons the franchise by failing to operate the business for five consecutive days unless such failure is due to fire, flood, earthquake or other similar causes beyond the franchisee's control. However, Subdivision (a) of Section 25.3 of the Unit Franchise Agreement permits immediate termination if you fail to operate for 14 calendar days with no exception.

4. With respect to APMs position on its compliance with the California statutes, the FIL and FRA, and the issues discussed in the above items, I direct your attention to the following paragraph which appears in pages 38 and 39 of the UFOC:

Some states require us to make certain statements regarding the possible effect of various laws on provisions in the documents you sign. We make these statements here and/or in state addenda to this Offering Circular (Exhibit G) only as a result of these requirements and in order to obtain registration and not because we agree with all the statements made. YOU SHOULD UNDERSTAND THAT WE INTEND TO FULLY ENFORCE ALL OF THE PROVISIONS OF THE DOCUMENTS YOU SIGN (INCLUDING THE FRANCHISE AGREEMENT), AND TO RELY ON FEDERAL PREEMPTION UNDER THE FEDERAL ARBITRATION ACT. Statements made by us here or in an addendum, as a condition of registration in a state, should not be construed as any indication that you and we have not had a meeting of the minds on any subject covered by those statements. As to any law that might make void or unenforceable any provision contained in any of the documents you sign, whether as a result of statements were required to make or otherwise, we reserve the right to challenge the enforceability and/or effect that law in any legal proceeding.

5. Section 25.5 of the Unit Franchise Agreement provides that if the Franchisor issues a notice of Default under circumstances where you have the right to cure the default and you do not cure the default within the applicable period, the franchisor has the right to appoint a manager to operate your unit franchise business until you have cured all defaults. If you dispute the default and seek to resolve the dispute by the mediation and arbitration provisions provided by Sections 28.1, you may have a situation where a person unknown to you will be managing your franchise business during the entire time it takes to resolve the dispute, which could be weeks or months. All expenses incurred during this period, including compensation, other costs and travel and living expenses of the appointed manager will be charged to you.

6. Section 7 of the Unit Franchise Agreement purports to grant you an exclusive territory. You should note, however, that Section 7 of the Unit Franchise Agreement provides that APM or anyone else can sell or otherwise distribute any products or services in your Territory whether or not such persons are using t he Marks or System so long as they distribute those products or services in any alternative channel of distribution other than Aussie Pet Mobile facilities or system. That means that APM could open a fixed retail unit in your territory offering the same services as you provide in your franchise unit. Essentially going into competition with you.

7. Section 26.5 of the Unit Franchise Agreement requires further explanation and clarification. It permits APM to terminate your franchise under Section 25.3 (immediate termination without opportunity to cure), for example, during the first year of its term and continue to require you to pay the royalties, marketing contributions and other monetary contributions for the remaining nine years of the term. It can be read that you would be obligated to continue to pay contributions and monthly royalties, etc., even after your Unit Franchise has been sold to a third party. In fact, it is clear from Section 24.2(9) that you remain liable for all obligations owing under the Unit Franchise Agreement after transfer of your franchise to a transferee who assumes payment of such obligations.

8. If your franchise agreement is terminated, you are required to return to APM the Designated Equipment without charge (including the trailer, and related items). See Section 26.2, p. 37. This appears to be a mistake because Section 26.6 gives APM an option to purchase at a determined fair market value. However, it is stated in bold type that on any transfer, repurchase, termination or expiration of the Unit Franchise: You will return to us the designated equipment WITHOUT CHARGE (Including the trailer, Hydro bath and related items. This seems to be a problem in that you will hold the title to this equipment, and if your business secures a loan, the lender will not release the trailers to APM, since they are security for the loan you will be left holding. In effect, it is claiming ownership of property it does not legally own.

9. There is a Marketing Fund you are required to contribute to. This marketing fund may be used, according to APM, for a variety of non-marketing expenses, including cost of new product development and for attorneys fees and costs incurred by APM related in any way to its defense of any claims against it. It also states that We have no obligation to cause other APM Unit Franchisee businesses to contribute to the marketing fund:

10. There are three separate Unit Franchise Agreements which are signed separately, The UFOC , in Item 7 on Page 12 states that you would be paying $45,000 and Designated Equipment of $80,625 to $83,850. At the same time you sign an Area Developer Agreement. Each agreement states $15,000 franchise fee and $25,000 for equipment. The numbers do not correspond. It also creates, in effect three separate franchise agreements, which ties back to characterizing abandonment in terms of trailer usage, verses in terms of servicing customers. This works in APMs favor to throw a Area Developer into default if there is a failure to meet the aggressive sales to match the minimum royalty schedule. Failure to have your business spread over all three trailers, regardless of whether it makes practical business sense, is a condition that can provide APM an opportunity to issue you a default notice.

11. There are some unknown variables which will increase the cost of doing business under this agreement. First, If a Franchise Owners Association is formed, you are forced to join and pay any necessary dues. Second, there will be expenses associated with upgrading the business to comply with current requirements, or upgrades, which may include new equipment See page 8 of UFOC. For example, APM can, at its discretion require you to pay for an upgrade, without consulting the franchisees first. Failure to comply throws you into default. If you equipment wears out prematurely, you are required to replace it. Third, you are required to pay a portion of all expenses associated with the toll-free number/yellow pages/URL system fee. See page 8 of UFOC. (not necessarily included in marketing fund). Fourth, You may be subject to additional and new insurance requirements. See payge 4, p. 10 of UFOC. Fifth, the marketing fund may furnish you with advertising and promotional materials, and you are required to pay the cost of producing them, plus shipping and handling. See page 20 of UFOC. Sixth, Upon renewal of franchise, you may required to purchase new Designated Equipment See Section 9.1 of the Unit Franchise Agreement.

12. The covenants not to compete are excessively broad. They do not comply with California Law. Note this paragraph on page 25: If the restrictions of this section are unenforceable or are reduced to a level which we, in our sole and absolute discretion, find unacceptable, we may, in addition to any other remedies available to us, require you to pay a fee (either paid immediately on a present value basis or over time, as we select) of one half of the royalties and marketing contribution which would be payable if the business in question was an APM franchise business for three years.

13. Section 22.6 of the Unit Franchise Agreement is troubling in two respects. If the Franchisor loses its right to use of the Marks which it has licensed to you, it can modify those marks, adopt new Marks and require you to pay the expense of replacing all signage, etc. It also raises some questions as to the validity of the ownership of the Marks claimed by APM.

14. APM represented at the time that it had 80 franchisees and yet it only included 18 on the list included in the UFOC. This is not permitted under Uniform Franchise Circular Guidelines. Item 20 of these guidelines require disclosure of the names of all franchisees in California, but if the total is less than 100, the franchisor must disclose outlets from all contiguous states and the next closest states until at least 100 are listed. This disclosure is obviously deficient. What are they hiding?

15. At the time of this UFOC in 2001, there appeared to be several entities with outstanding registrations to sell APM franchises, two were located in Southern California. It is unclear what the relationship of these entities were, are are.

To Jim: I think it is you who sent the anonymous e-mail. You signed your e-mail: 'Aussie Pet Mobile Franchisees.' Don't you think that's anonymous; looks anonymous to me.

To Steven: Do you really think that posting Jim's personal information in regards to how he handled his business and finances on a world-wide public forum is a good idea? If Aussie Pet Mobile decides to sue Jim for his breech of contract (if there is one) then this will be something that will hinder any lawsuit proceedings that you may have against Jim and his franchise.

I'm not an attorney, yet, and I haven't read the contract, but I know how businesses operate, and that's to make a profit. It seems to me that Aussie Pet Mobile is similar to Primerica in the fact that you recruit new people, take their money, and then leave them hanging with nothing but bad credit.

To Jim: I think it is you who sent the anonymous e-mail. You signed your e-mail: 'Aussie Pet Mobile Franchisees.' Don't you think that's anonymous; looks anonymous to me.

To Steven: Do you really think that posting Jim's personal information in regards to how he handled his business and finances on a world-wide public forum is a good idea? If Aussie Pet Mobile decides to sue Jim for his breech of contract (if there is one) then this will be something that will hinder any lawsuit proceedings that you may have against Jim and his franchise.

I'm not an attorney, yet, and I haven't read the contract, but I know how businesses operate, and that's to make a profit. It seems to me that Aussie Pet Mobile is similar to Primerica in the fact that you recruit new people, take their money, and then leave them hanging with nothing but bad credit.

To Jim: I think it is you who sent the anonymous e-mail. You signed your e-mail: 'Aussie Pet Mobile Franchisees.' Don't you think that's anonymous; looks anonymous to me.

To Steven: Do you really think that posting Jim's personal information in regards to how he handled his business and finances on a world-wide public forum is a good idea? If Aussie Pet Mobile decides to sue Jim for his breech of contract (if there is one) then this will be something that will hinder any lawsuit proceedings that you may have against Jim and his franchise.

I'm not an attorney, yet, and I haven't read the contract, but I know how businesses operate, and that's to make a profit. It seems to me that Aussie Pet Mobile is similar to Primerica in the fact that you recruit new people, take their money, and then leave them hanging with nothing but bad credit.

To Jim: I think it is you who sent the anonymous e-mail. You signed your e-mail: 'Aussie Pet Mobile Franchisees.' Don't you think that's anonymous; looks anonymous to me.

To Steven: Do you really think that posting Jim's personal information in regards to how he handled his business and finances on a world-wide public forum is a good idea? If Aussie Pet Mobile decides to sue Jim for his breech of contract (if there is one) then this will be something that will hinder any lawsuit proceedings that you may have against Jim and his franchise.

I'm not an attorney, yet, and I haven't read the contract, but I know how businesses operate, and that's to make a profit. It seems to me that Aussie Pet Mobile is similar to Primerica in the fact that you recruit new people, take their money, and then leave them hanging with nothing but bad credit.

Aussie Pet Mobile is a respected, ethical, fully registered franchise. Aussie Pet Mobile, Inc., has complied with every law governing the offer and sale of franchises and is recognized as one of the finest and fastest growing franchises in the country. Its aim is to develop a system of successful franchisees, based on the simple and obvious principle that success is a mutual and cooperative venture.

Mr. Anderson, unfortunately, is an embittered man who has resorted to slander and dishonesty to exact revenge for his own failure. His report is a string of falsehoods, and it is a shame that RipOff Report.com, which hides in St Kitts to avoid the legal consequences of its participation in such unlawful activities, has no policy against reprinting actionable lies.

Mr. Anderson is a failure because he was not prepared to make the investment and the effort required to develop a successful business. Like all Aussie Pet Mobile franchisees, Mr. Anderson received a duly registered offering circular well before he signed his franchise agreement and he received no misrepresentations in or outside the offering circular. He acknowledged in his own handwriting that he had received no representations outside the offering circular. He knew the investment and effort required to make the business a success, but apparently he was not prepared to make them or, for that matter, to honor any of his commitments. Within a few weeks after signing his agreement, he had abandoned the business and reneged on his obligations to Aussie Pet Mobile, Inc., to his vendors and to the lender who financed his business (which is not related to or associated with Aussie Pet Mobile in any way).

Among other things, Mr. Anderson purchased three Toyota pick-up trucks from a dealer and signed loan documents. He abandoned the vehicles on a car lot in Orange County without any oral or written notice or warning to the dealer or the lender. When the lender contacted him to inquire about his non-payment, he misdealt with the lender.

When Aussie Pet Mobile, Inc., first learned of and became concerned about Mr. Andersons plight, they immediately began trying to help Mr. Anderson save his home, which he put up as collateral for the loan. Aussie Pet Mobile, Inc., invited Mr. Anderson to a face-to-face meeting to discuss a solution. At that meeting, Mr. Anderson signed a Prospect Introduction Agreement in which Aussie Pet Mobile, Inc., agreed to make efforts to help him sell his business. He very quickly defaulted on that agreement, at which time he abandoned his customers and his vehicles. He also began circulating disparaging e-mails to Aussie Pet Mobile franchisees and making dishonest and false charges against the company.

Aussie Pet Mobile, Inc., again invited Mr. Anderson to a meeting to discuss his defaults and problems and his erratic and harmful behavior. At that meeting, and always until the matter was settled, Mr. Anderson was represented by his personal attorney, Jeff Golden, and by his business attorney, Willie R. Barnes, a partner in the large, old, prestigious law firm of Musick, Peeler & Garrett. Working together, Aussie Pet Mobile, Inc., and Mr. Anderson and his lawyers negotiated a written settlement in which they all agreed to the following things:

* Aussie Pet Mobile, Inc., suspended its default notices and agreed to take no further action against Mr. Anderson;

* Aussie Pet Mobile, Inc., agreed to make all payments on Mr. Andersons loan so it would not go into default and he would not lose his property;

* Aussie Pet Mobile, Inc., agreed to take over the operation of his territory while assisting Mr. Anderson in the sale of the franchise;

* Aussie Pet Mobile, Inc., agreed to try for six months to sell the territory and, if that was unsuccessful, then Mr. Anderson, at his option, could extend the agreement for another six-month period; and

* If the territory sold, Aussie Pet Mobile, Inc., could reimburse itself for out-of-pocket costs, pay off the loan and deliver the balance, if any, to Mr. Anderson. (Aussie Pet Mobile, Inc., was successful in that endeavor and the territory was sold to a new franchisee who is developing it very well. The loan was paid off in full on Mr. Andersons behalf.)

* Because Mr. Anderson had acted in such an irrational manner by abandoning the customers and the trucks after such a short time, and because he had already embarked on a campaign of public disparagement of Aussie Pet Mobile, Inc., Mr. Anderson also agreed to issue an apology and a retraction of the dishonest and malicious things he had been circulating about Aussie Pet Mobile, Inc., and the Aussie Pet Mobile System and agreed to complete confidentiality. The purpose of the clause was to prevent future destructive outbursts.

There were other terms, all of which were favorable to Mr. Anderson and designed to help him in a difficult situation of his own making. He acknowledged this at the meeting and in writing.

Unfortunately, Mr. Anderson was unable to stand by his admissions or keep any of his written promises. He had already failed at the outset to follow the written agreements he signed with Aussie Pet Mobile, Inc., with the Toyota dealer or with his lender. After he negotiated a very favorable settlement agreement with Aussie Pet Mobile, Inc., using some of the best lawyers in Los Angeles to do so, he again refused to follow any of his written obligations in that agreement.

His RipOff Report item is simply a string of lies and wild unsupported name-calling.:

* Aussie Pet Mobile, Inc., has never violated the California Franchise Investment Law (the CFIL) and is justifiably proud of its strict adherence to ethical and legal principals. There are no waivers violating any CFIL section (there are no waivers at all). However, the United States Supreme Court has ruled, in a series of cases involving arbitration and the Federal Arbitration Act, that the portion of the California Franchise Relations Act attempting to limit the enforceability of arbitration clauses is illegal. That is probably the waiver he is talking about. As a result of that waiver Mr. Anderson was required to comply with the Dispute Avoidance and Resolution provision of his franchise agreement and drive three miles from his home in Mission Viejo, California, to Aussie Pet Mobile, Inc.s offices in Dana Point, California for the face-to-face meeting. Because of the meeting, the case settled, though it did not stay settled due to Mr. Andersons bad faith and erratic behavior.

* Mr. Anderson was never a top producer. Aussie Pet Mobile, Inc., never threatened to take him off the list of franchisees in the offering circular. That would be unlawful. Aussie Pet Mobile, Inc., discloses the name and address of every franchisee and reports all of its litigation (if any). However, it is safe to say that Aussie Pet Mobile, Inc., will never actively refer a prospective franchisee to Mr. Anderson.

* Any reader can judge Mr. Andersons honesty and reasonableness by his accusation of mafia like tactics. While the only thing Mr. Anderson accuses Aussie Pet Mobile, Inc., of doing is to enforce the franchise agreement he signed, in fact Aussie Pet Mobile, Inc., bent over backwards to avoid enforcing the terms of the agreement and to make a very favorable deal with Mr. Anderson for his own protection. It is an old adage that no good deed goes unpunished, and that turned out to be the case here.

If Aussie Pet Mobile, Inc., were doing anything illegal, Mr. Anderson and his team of lawyers could have done something above-board about it. If Mr. Anderson could not afford to sue (and there are dozens of franchise lawyers around the country eager to represent franchisees with legitimate claims on a contingency fee basis), then he could have reported Aussie Pet Mobile, Inc., to the authorities. Obviously he has not and he cannot. Instead, he uses the discredited tactics of name-calling and mud-slinging instead of being man enough to accept the truth of his own failure.

Therefore, while Mr. Anderson says he would list all the violations of franchise laws here, but what is the point? the truth is that he has no such violations to list. The only violations of law were Mr. Andersons. He is the one who violated the important provisions of his franchise agreement. He is the one who violated the important provisions of his settlement agreement, which was negotiated in his favor by top lawyers. He is the one who agreed to apologize for his untruthful slanders of Aussie Pet Mobile, Inc., and to stop repeating them, and then not only continued to do so, but has now published this disgraceful RipOff report.

As a result, and for its further protection, Aussie Pet Mobile, Inc., has instructed its counsel to file an action against Mr. Anderson seeking damages for the injuries he has caused by his irresponsible behavior and an injunction against any further wrongful acts.

Ian replied to the email sent out to corporate headquarters, copied to all franchisees. This was his response.

March 24, 2003
To: Aussie Pet Mobile Franchisees:

On Sunday March 23, 2003, we received an unsigned e-mail from

AussiePetMobile1@aol.com which is an address unknown to us. It indicated that copies had been sent to all of you. We are sorry you were exposed to it, but such messages are all too easy in this electronic age.

We have received phone calls and e-mails from many of you telling us that you had nothing to do with this e-mail and did not share the sentiments expressed in it. Thank you.

It is clear that whoever sent this anonymous (and therefore cowardly) message does not represent the many franchisees in the Aussie Pet Mobile System who are working together to make this the most successful and leading pet-care franchise in the United States.

When we created the franchise agreements for this System, we were very careful to include a very special Dispute Avoidance and Resolution provision that emphasized the necessity of a face-to-face meeting with us and offered professional mediation to resolve disputes. It is our experience and that of our advisors that practically every problem or disagreement can be resolved when we sit down together to work it out. That is why the meeting is required and mediation is available.

Please know that our door is always open for a face-to-face meeting with me or any of the other members of the Aussie Pet Mobile team. On the other hand, the door is never open for anonymous attacks. All you have to do is call us, say who you are and request a meeting and we will arrange one immediately. We are proud to tell you that we have successfully handled every concern brought to us in this manner.

Our Progress
Every one of you signed up with Aussie Pet Mobile in the first or second year of our operation in the United States. While you knew that the concept and the business model were excellent and designed for success, you also knew that you were joining us to build a start-up business new to the United States market. We are pioneers together and we all knew that would require hard work, patience and an investment that might not immediately pay lavish dividends. We continue to believe that we are not only on track to achieve all of our goals, but that we have been very successful in doing so.

This is a difficult time in America. We are at war and the economy has slipped from the steady growth it enjoyed in the 90's. In good times and in bad, we need always to continue to work to develop and improve our System and to have the patience and strength to weather economic changes.

The anonymous e-mail made several claims that are simply untrue and show that its purpose was to be hurtful, not constructive. Hidden behind a cloak of anonymity, such irresponsible remarks can only foment suspicion and distrust. If we were to allow that to happen, it would injure all of us in our business. We all have too much invested in our common endeavor to let the sniping of a nameless malcontent distract us from our goal.

Our Dispute Avoidance and Resolution procedure, by contrast, creates a forum for open discussion and the face-to-face exchange of ideas. It was intended to foster growth and
improvement. We invite your participation in that forum. Therefore, as always, if any of you desires to sit down and discuss things, I welcome your call. In the meantime, let us continue to devote ourselves to positive efforts to develop the Aussie Pet Mobile System from which we will all benefit.

Sincerely,
Ian W. Moses
President

I'm not sure who sent the "open letter", but it was obviously an unhappy franchisee. I'll let you draw your own conclusion about the franchisor. As it stands now, the franchisor has threatened to sue me, and has informed me that he is proceeding with filing a complaint against me for posting my story here.

Ian:
Many of us have been talking and we have serious concerns and issues with your franchise. We have several questions for you, and your responses will have an effect on how we choose to act. We suggest that you consider your responses carefully. We also request that you respond to us as a group vial e-mail by reply all to this note.

So far, many of us feel that you have sold us a business model that is not able to be successful. No Area Developer is operating at a level that you led us to believe is possible. The costs are much higher than the cash flow supports; training is not meeting our needs and there is a complete lack of operational support and improvements from corporate. Unless some things change quickly, many of us will go out of business. The result to the overall franchise of this occurring would be significant.

Here are some of the questions we would like you to respond to:

#1 - Business Model. How do you justify your business model? A franchise is supposed to show a track record of business success that can be replicated by following common best practices - yours does not. So far, no area developers are able to show that their business is even close to an operational success, and you seem to be figuring out the business at our expense and based on our investment. We want you to explain and justify how you came up with how many households can support each trailer, and each territory. Why the trailer rollout schedule is so aggressive. Why is the cost of a trailer is 2x to 3x what it should actually cost to produce one? In 2002 you took in $435,000 from trailer sales. Where does this money go? Why should we be required to pay up-front for equipment that we cannot get any use of for 1- 3 years?

#2 - Marketing efforts. So far we have seen precious little from you on building a national brand as we were promised. How is Aussie Pet Mobile different from, say, American Mobile Pet Grooming, to the customer? Now you say that we owe you $200,000 and you have unilaterally decided to cancel Yellow Pages advertising. Your decision has harmed many of us because you choose to cancel the Yellow Pages before letting us know in time to place our own ads, now we have to wait between 6 months and a year before new books are published. What are you spending the advertising dollars on? How are you building a national brand and helping us to grow our businesses? If the 888 Call Center is draining resources, and not adding any value to the business, then phase it out and let us do or own advertising. We would like to see a plan and a budget from you outlining the overall plan for corporate marketing. We pay for it so we want to see it.

#3 - Royalty. How do you justify your aggressive minimum Royalty plan? At an average rate of $48.00 a pet, you need to do 97 pets (or $4,688 in revenue) to justify $375 in royalty; you need to do 130 pets (or $6,250) to justify $500 in royalty. Based on a 5 day workweek, 130 pets = 6.5 pets a day. Based on your last Top Ten report, only 2 trailers are doing more than 130 pets in a month; and only 7 are doing more than 97 pets in a month. If this is the Top 10, we would all like to see the entire list. How many operators with over one year in operations are even hitting the minimum royalty levels? What size territories to they have? We would like to see the complete list, along with the average price per pet. You can take out the names and locations, but give us the whole picture about how the business is doing.

#4 - Equipment Problems. These trailers are terribly built and have no hope of lasting for 10 years. Many are falling apart already. Each day out of service is a lost day of revenue for us. The electrical system is a nightmare, the roofs leak, and equipment is badly rusting. What plans do you have for refurbishing the trailers as they fail?

#5 - Investments. Please explain to us why you spent $2.2 million to buy the building the office is in? Besides the fact that buying office space in this business market makes no sense, how does this help us in our business? If this is a personal investment on your part and did not involve any APM funds, just let us know and it is not a major issue (unless you are charging yourself (us) excessive rent!!) If it involved APM funds, what is you thinking on this purchase?

We are waiting for your response.

Aussie Pet Mobile Franchisees

For any other franchisees who are dealing with franchisors like this one. Try collective bargaining. I am interested in hearing his response.