• Los Angeles Times, Thursday, February 28, 2008 11:45 AM

Daily Queen owner associations with franchise members in 10 states are suing the company, claiming that it is trying to force them to spend between $275,000 and $450,000 to remodel stores and to adhere to an unproven concept that will cost more to operate, double staffing requirements, and cut into profits.

Dairy Queen's plans center on two relatively new restaurants lines. DQ Grill & Chill establishments would sell meals and desserts, and would expand to include limited table service, among other things. Outlets that sell only Blizzards, Dilly Bars and desserts would combine with the Orange Julius beverage chain to become a DQ/Orange Julius Treat Center.

The required modernization should be no surprise to franchise owners because it's standard in most of their contracts, says Dairy Queen CEO Chuck Mooty. He argues that franchise-owner associations, which compete with the corporation to supply the restaurants, are stirring up trouble.

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