A state court in Washington has granted summary judgment and awarded over $3.4 million in attorneys’ fees and costs to a franchisor in a dispute brought by the Washington Attorney General under the Washington’s Consumer Protection Act (CPA) and Franchise Investment Protection Act (FIPA). Washington v. Nat’l Maint. Contractors, LLC, No. 21-2-04554-1 (Wash. Sup. Ct. Nov. 1, 2024). Washington, through its Attorney General, brought suit in King County Superior Court alleging that National Maintenance Contractors, LLC and related entities (NMC) violated the CPA and FIPA in connection with the marketing, sale, and operation of janitorial franchises in the state of Washington. Lathrop GPM represented NMC in the matter. The Attorney General alleged NMC targeted and lured vulnerable consumers into investing in janitorial franchises based on false promises. The Attorney General sought hundreds of millions of dollars in penalties and sought to expand the CPA’s reach as applied to franchising. After years of litigation, NMC moved for summary judgment, arguing its franchise system did not have the capacity to deceive a substantial portion of the public and NMC did not engage in unfair or deceptive acts or practices. The court agreed, found there were no issues of material fact on the remaining claims, and granted summary judgment.
Following summary judgment, NMC moved to recover its attorneys’ fees and costs. Applicable law provides that the prevailing party may recover its attorneys’ fees and costs, but Washington courts rarely award fees and costs against the Attorney General. NMC argued this was an exceptional case as Washington pursued claims that lacked factual and legal support, sought overreaching discovery, avoided its own discovery obligations, took legally deficient positions, and an award was necessary to deter Washington from abusing its prosecutorial discretion and power. The court agreed and granted NMC over $3.4 million in attorneys’ fees and costs.
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