UPDATE: A major lawsuit has erupted against the well-known barbecue chain, Dickey’s Barbecue Pit, as it faces allegations of overcharging franchisees amid growing concerns over its business practices. Josef Francis Gregory, a franchise owner, initiated legal action on July 9 in Harris County Court, Texas, claiming that the company hired a construction firm that inflated expenses for his restaurant build-out.
Gregory’s lawsuit draws attention to a troubling partnership with HDH Construction LLC, which he claims failed to complete the build-out of his Nassau Bay, Texas location after he paid “hundreds of thousands of dollars.” The franchise owner alleges that the construction was “unwarranted, unapproved, and contrary to the agreement” he had signed back in 2019. He is now seeking damages exceeding $1 million.
In a statement to MassLive, Dickey’s responded, asserting that the lawsuit is based on “significant factual inaccuracies” and emphasized that Gregory chose Dogwood State Bank for financing and HDH Construction as a contractor on his own. The franchise chain clarified that it did not mandate these selections and that Gregory bore full responsibility for the build-out process and related payments.
“Dickey’s is not a party to the financing agreement and has no authority to control or direct the disbursement of loan proceeds,” the statement read. Furthermore, the company expressed disappointment over Gregory’s decision to pursue legal action, claiming that it has always acted with integrity and in accordance with its contractual obligations.
This lawsuit comes at a time when Dickey’s is already facing scrutiny from its franchisees. A recent report by the New York Times revealed that 37 franchisees felt misled into investing based on questionable financial information. These revelations follow the closure of 97 locations during the 2024 fiscal year and the sale of 106 franchises, leaving the chain with a total of 385 restaurants globally.
With franchisee relations at a breaking point and public confidence wavering, the outcome of this lawsuit could have significant implications for Dickey’s future operations. Observers will be watching closely as this legal battle unfolds, particularly its potential to reshape the franchise landscape for the renowned barbecue chain.
As the situation develops, more updates are expected regarding both the lawsuit and the ongoing struggles within Dickey’s franchise system. The implications of this case extend beyond legal ramifications, touching on the livelihoods of franchise owners and the overall reputation of a brand that has served customers since its founding in 1941 in Dallas, Texas.
Stay tuned for further updates on this urgent matter as the story develops.
