Another claims that Snap-on sold a second franchise to a dealer without informing him of its risks. That former dealer - New York-based Brian Casey, who the lawsuit said was 1998 Snap-on "Rookie Dealer of the Year" - lost his $40,000 initial investment and owes Snap-on $257,000 after being granted the second dealer route, Marks said. The suits also claim Snap-on extended "excessive amounts of credit to dealers, inducing them to purchase more tools than they can resell to their customer base, ultimately causing them to go out of business."
Also, the lawsuits cite an arbitration agreement contained in Snap-on dealer contracts that limits dealers' abilities "to go to court to get back money that was unfairly taken from them."
Snap-on called a press release from Marks about the lawsuits "misleading," noting that Marks has filed similar lawsuits before and that a Superior Court of New Jersey judge found the arguments to be "specious" and stated that the "plaintiff's contentions appear to have little merit and, in some instances, are inherently contradictory." The company said the "vast majority" of its growing number of dealers are happy with their franchises.
"We do all we can to help our dealers because, obviously, Snap-on succeeds when its dealers succeed," according to the company. "That said a franchise is like any other business - there is no guarantee of success."
More than a dozen women have formed a group called Wives Against Snap-on (WASO) and have set up a Web site (wwww.snap-onfranchisefraud.com) to further their cause against the company.