Philadelphia Domino’s Held Liable for Car Accident Injuries Caused by Franchisee’s Employee

By Kristen M. Smith

Domino’s Pizza LLC (“Domino’s”), along with one of its franchisees, was found liable by a jury in the Philadelphia Court of Common Pleas for injuries sustained by a driver involved in a car accident with a delivery driver employed by a Domino’s franchisee. 

In the case at hand, Coryell v. Morris, et. al. (Philadelphia Court of Common Pleas No. 18062732), Plaintiffs claimed that Domino’s was both vicariously and directly liable for negligence.  Specifically, Plaintiffs alleged that Domino’s was vicariously liable for the negligent actions of its franchisee’s employee, who caused the automobile accident, based on having either an employment or agency relationship with the employee.  Plaintiffs alleged that Domino’s was directly liable due to, among other things, negligently promoting policies that encouraged drivers to violate traffic laws and operate delivery vehicles in an unsafe matter in order to meet certain performance requirements mandated by the franchisor.

Domino’s argued that under its standard franchise agreement, it did not have control over a franchisee’s operations and thus could not be held liable for the actions of a franchisee’s employee.  Plaintiffs argued that the franchise agreement provided Domino’s with the right to establish any rule at any time with respect to the operations of the franchised business.  Ultimately, the jury determined that Domino’s did have sufficient control or have a right to control its franchisee, such that it could be held liable for the negligence of its franchisee’s employee.

We fully expect Domino’s to appeal this verdict.  The hallmark of the franchise relationship is the contractual, independent business relationship between franchisor and franchisee.  Established case law supports this separation, and franchisors are not liable for the acts of its franchisees or its franchisees’ employees.  However, the National Labor Relations Board, state legislators, and juries have been reexamining the joint employer standard and theories of liability when balancing brand protection and operational control in recent years, calling into question established precedent on these issues. 

We will monitor this case, particularly the status of any appeal, and release updates as they become available.