Case Explained: MEINEKE FRANCHISOR SPV, LLC, ET AL. V. CJGL, INC., ET AL.

Court: United States Court of Appeals for the Ninth Circuit

Filed: 2026-07-16

Docket: 2:23-cv-00374-SPG-JC

The Ninth Circuit affirmed the district court’s grant of summary judgment to Meineke Franchisor SPV, LLC and Meineke Realty, Inc., rejecting all counterclaims asserted by CJGL, Inc. and the Doumas. The court held that the appellants did not waive their right to appeal despite stipulating to the final judgment, as the record demonstrated they intended only to agree to the form of the judgment rather than its substance. Applying a de novo standard of review under Federal Rule of Civil Procedure 56(c), the court analyzed each counterclaim under applicable California law and federal procedural standards. Regarding intentional misrepresentation and fraudulent inducement, the court applied the rule that affirmative evidence of an intent not to perform at the time the promise was made is necessary to survive summary judgment; it found no such evidence because Meineke had attempted to assist with the lease and executed the renewal agreement after explicitly stating it would no longer guarantee leases. The breach of the covenant of good faith and fair dealing claim failed because the sublease benefits terminated in June 2021, prior to when the appellants vacated the premises in August 2022. The court further ruled that the rescission and restitution counterclaim was barred because the appellants failed to provide prompt notice of rescission as required by California Civil Code sections 1691 and 1693, having waited over seven months after vacating the premises to file their claims. The California Franchise Investment Law (“CFIL”) counterclaims were dismissed on statute of limitations grounds under California Corporations Code section 31304, as the claims were filed more than one year after the appellants discovered the alleged violations, and because the second theory was not properly pleaded in the complaint. Additionally, the interference with prospective economic advantage claims failed due to a lack of evidence that Meineke’s conduct was “independently wrongful” under California common law standards. Finally, the Unfair Competition Law claim was dismissed as it stood or fell with the underlying substantive causes of action. The practical consequence is that the summary judgment in favor of Meineke remains in effect, and the counterclaims are permanently dismissed.

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