Canadian "Sears Hometown" Store Dealers launch $100 Million Class Action against Sears Canada and Sears, Roebuck

Canadian "Sears Hometown" Store Dealers launch $100 Million Class Action 
against Sears Canada and Sears, Roebuck 
TORONTO, July 5, 2013 /CNW/ - A "Sears Hometown" store owner in Woodstock, 
Ontario launched a class action lawsuit today on behalf of approximately 260 
Sears Hometown dealers across Canada against Sears Canada Inc. (TSX: SCC) and 
its American affiliate, Sears, Roebuck and Co. (together, "Sears"). Sears 
Canada Inc. and Sears, Roebuck and Co. are subsidiaries of US-parent company 
Sears Holding Corporation (NASDAQ: SHLD), a company guided by U.S. billionaire 
and founder and CEO of hedge fund ESL Investments, Inc., Edward S. Lampert. 
The lawsuit alleges that Sears has breached its legal obligations by depriving 
the dealers of the realistic opportunity to earn a living wage and make a 
reasonable profit from their Hometown store businesses. At the same time, 
Sears reaps the benefits of the dealers' hard work and investment and enjoys 
significant profits from the dealer network. 
Sears Hometown dealers are independent franchise operators in smaller markets 
in every province and territory of Canada. For millions of Canadians, they 
are the face of the colossal Sears brand. 
The dealer agreement is structured so that Sears sets dealers' compensation 
and work conditions, without regard to either minimum labour standards or 
franchise protection laws. 
Over the past 3 years, Sears Hometown store dealers have seen a continuous 
erosion of sales and profits. Meanwhile, Sears is making substantial profits 
from each and every Hometown store. 
As dealers across Canada exhaust their savings, struggle to stay in business, 
or close down and face personal financial ruin, Sears has responded by: 
lowering dealers' commissions, reducing local store advertising, and bypassing 
dealers' stores altogether by selling directly to customers located within the 
dealers' contractually protected market areas. This story repeats across the 
country, with approximately 70% of dealer stores being unsustainable. 
Dealers typically work 50-60 hour weeks and are liable to landlords, 
employees, etc. for all costs associated with running their businesses. 
Dealers have pleaded for meaningful changes, and worked to improve the model, 
to no avail. 
Jim Kay, the class representative and owner of the Sears Hometown store in 
Woodstock, Ontario, describes the dealers' desperate situation this way: 
"We put our heart and soul into this business and the community it serves. 
We supported local charities, serviced our customers, and wore the Sears name 
with pride, all on a subsistence wage, often injecting money to meet payroll 
and keep the doors open. 
We are tired of losing money. We are tired of disappointing our customers 
because we lack the resources to serve them properly. We are tired of facing 
the public without a smile, because we know there is no paycheck at the end of 
the week. We are tired of being fed scraps for the benefit of a U.S. hedge 
fund billionaire." 
The representative plaintiff brought the action under Ontario's Class 
Proceedings Act, 1992. The claim seeks court certification on behalf of all 
Sears Hometown store dealers in Canada. 
A copy of the court filed statement of claim is available at: 
The dealers are represented by the Toronto law firm of Sotos LLP 
on the case, contactDavid Sterns (416) 977-5229. 
To view this news release in HTML formatting, please use the following URL: 
CO: Sotos LLP
ST: Ontario
-0- Jul/05/2013 19:46 GMT
Press spacebar to pause and continue. Press esc to stop.