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Banek, Inc. v. Yogurt Ventures U.S.A., Inc.

United States Court of Appeals for the Sixth Circuit
6 F.3d 357 (1993)


Facts

Mr. and Mrs. Banek owned Banek, Inc. (Banek) (plaintiff), a Michigan company. Banek entered into a contract with Yogurt Ventures U.S.A., Inc. (Yogurt) (defendant), a Georgia company, to purchase a yogurt franchise in Michigan. A choice-of-law provision in the agreement provided that Georgia law governed the rights and obligations of the parties. Two years later, Banek closed the store in response to dismal sales. Prior to shutting down the store, Banek filed suit in Michigan state court against Yogurt, alleging breach of contract, fraud, violations of the Michigan Franchise Investment Law (MFIL), and other claims. Shortly thereafter, Mr. and Mrs. Banek filed a separate suit against the owners of Yogurt. The two actions were consolidated and the matter was removed to federal district court on the basis of diversity jurisdiction. Yogurt moved to dismiss the complaint. The district court granted the motion in part, holding that the choice-of-law provision was valid and enforceable under Michigan law. Banek appealed.

Rule of Law

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Issue

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Holding and Reasoning (Guy, J.)

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  • A “yes” or “no” answer to the question framed in the issue section;
  • A summary of the majority or plurality opinion, using the CREAC method; and
  • The procedural disposition (e.g. reversed and remanded, affirmed, etc.).

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