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New World Announces Withdrawal of Suit by Manhattan Bagel Franchisees

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Eatontown, New Jersey--New World Restaurant Group Inc. announced that Zebu Forno has agreed to cease the sale of frozen bagel dough to Manhattan Bagel franchisees. In a related matter, the attorney for four Manhattan Bagel franchisees in New Jersey, Pennsylvania and Ohio has withdrawn an action seeking an injunction that would have allowed the franchisees to purchase frozen dough from unapproved outside suppliers.

Earlier this year, Zebu Forno had solicited and attempted to sell bagel dough to Manhattan Bagel franchisees in violation of the company's franchise agreement. In March, Zebu Forno filed a complaint in New Jersey Superior Court asserting it had the right to sell bagels to the franchisees. New World later filed a counterclaim asking the court to enjoin Zebu Forno from selling unapproved bagel products to Manhattan Bagel franchisees.

As part of the agreement, Zebu Forno acknowledged that Manhattan Bagel franchisees are obligated under their franchise agreements to purchase frozen bagel dough only from approved suppliers. -PRNewswire

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