RaceTrac Suing Over 'Brownies,' Breach of Contract

Published in CSP Daily News

Says franchisee refused to vacate, diverted gas funds, sold illegal products

ATLANTA -- RaceTrac Petroleum claims a franchisee breached contract by selling "relaxation brownies" with synthetic marijuana at his convenience store near Shreveport, La, and that he took sales revenue for himself, along with the store's alcohol and tobacco inventory, and refused to vacate, RaceTrac said, according to a report by Courthouse News Service.

RaceTrac has sued its former franchisee, Eric Banks, and his former outlet, New United Petroleum Enterprises (NUPE), Ruston, La. RaceTrac claims Banks breached his agreement by "among other things, selling illegal drugs in violation of Louisiana law, failing to pay rent and failing to perform various obligations required by the parties' agreements."

The Lincoln Parish Narcotics Enforcement Team arrested two of Banks' employees after twice buying the "relaxation brownies" over the counter at the store, RaceTrac said.

Louisiana outlawed synthetic marijuana on July 15 this year. It is made from "a mixture of herbs and spices and sprayed with a compound chemically similar to THC, the psychoactive ingredient in marijuana," Atlanta-based RaceTrac said in its complaint in Cobb County Court.

"The synthetic marijuana was packaged under the names 'Cush,' 'Blubonic Chronic,' 'Dank,' 'High Times,' 'New Dimension,' 'White Rabbit' and 'Voodoo Spice.' The seized marijuana was hanging on display behind the counter as well as being stored under the counter," the complaint said.

"In addition to synthetic marijuana and related invoices, the LPNET also seized boxes of an illegal product known as 'relaxation brownies,' packaged under the name 'Kush Cake'."

That day, RaceTrac said, it terminated its lease agreement and demanded immediate possession of the outlet, in a message hand-delivered to Banks. Also that day, it said, Banks "removed valuable inventory comprising part of the collateral in which plaintiff has a security interest ... For example and without limitation, defendants removed tobacco products and alcohol."

On October 9 Banks promised to surrender the store, but changed his mind and told it the next day he refused to leave, said the report. RaceTrac locked the pumps and stopped delivering gasoline to the store, which has damaged it.

It claimed Banks and NUPE sold gasoline from October 4 to 6, and diverted the money rather than putting it into a RaceTrac bank account, and that on October 11, Banks withdrew all the money in the account, $4,748.03.

According to the report, RaceTrac is seeking compensatory and punitive damages for breach of contract, unjust enrichment, conversion and breach of fiduciary duty.

It has initiated eviction proceedings against NUPE. An expedited hearing is set for November 21.

Atlanta-based RaceTrac is a privately held chain of more than 500 gas station-convenience stores across the Southeast United States.