New Delhi: The National Company Law Tribunal (NCLT) on Friday said it will start hearing the final arguments in the contempt plea against American fast food chain McDonald’s Corp. filed by its estranged partner Vikram Bakshi on 15 March.
This came as McDonald’s filed a reply to the contempt notice of NCLT last week, after being given a final warning by the tribunal.
A bench comprising justice Deepti Mukesh and S.K. Mohapatra was hearing an appeal filed by Bakshi, who is the managing director of the McDonald’s north and east India licencee Connaught Plaza Restaurants Pvt. Ltd (CPRL), in September 2017.
McDonald’s India, the local unit of US-based burger chain, had terminated its franchise agreement with CPRL in August last year. In his plea, Bakshi had alleged that the termination of franchise agreement was in conflict with an earlier order of NCLT dated 13 July 2017, which had asked McDonald’s Corp to refrain from interfering in the smooth functioning of CPRL and all its 169 McDonald’s outlets in north and east India.
The matter has been pending with NCLT for close to six months as McDonald’s India had challenged NCLT’s right to issue a contempt notice to its US parent in Delhi high court. After a single judge bench allowed NCLT to proceed with the contempt plea in January, McDonald’s India again appealed the high court’s order on 29 January.
Separately, Delhi high court is also hearing McDonald’s India’s plea, alleging violation of its intellectual property including its trademarks, designs and branding by CPRL, by continuing to sell products in the name ‘McDonald’s’ even after the termination of the franchise agreement. Meanwhile, Bakshi has been running all 169 restaurants in north and east India.
This legal feud started in 2013, when McDonald’s India voted against Bakshi’s re-election as managing director of CPRL, following which Bakshi challenged his removal at the Company Law Board (now NCLT).
NCLT reinstated Bakshi as managing director on 13 July, an order which was challenged by McDonald’s India in the National Company Law Appellate Tribunal.