US fast food giant McDonald’s and its Indian partner Vikram Bakshi are working towards a settlement after years of acrimonious legal battles over the operations of McDonald outlets in north and eastern India.
Counsel for the two parties on Monday informed the National Company Law Appellate Tribunal (NCLAT) they were working towards an out-of-court settlement to end their legal dispute of over five years.
The bench said either of the parties may file an affidavit including the terms of the settlement being arrived at on the next date of hearing on May 13.
“In the facts and circumstances, we allow the parties to reach settlement uninfluenced by any of the order passed by the Tribunal or this Appellate Tribunal,” the NCLAT said.
McDonald’s and Bakshi had in 1995 signed a 25-year partnership agreement to open the outlets of the US fast food chain in the country.
The two partners had formed a 50:50 joint venture — Connaught Plaza Restaurant Ltd (CPRL) — for McDonald’s outlets in the country’s northern and eastern regions through franchises.
The relationship went sour in 2013 when McDonald’s opposed Bakshi’s re-appointment as CPRL managing director.
McDonald’s India terminated CPRL’s franchise agreement in August 2017 citing the non-payment of royalties. CPRL was told to stop using the McDonald’s system, which includes proprietary rights in McDonald’s names, trademarks, designs, branding, operational and marketing practice and policies, and food recipes and specifications, and its associated intellectual property from September 6, 2017.
A lengthy legal tussle and battle for control of the business ensued with Bakshi keeping around 165 McDonald’s outlets operational in the northern and the eastern regions of the country. In the south and in the west, the outlets are run by Amit Jatia-led Westlife Development.