RE/MAX International
Raided My Company

I purchased 14 real estate franchises and paid approximately $1 million in fees to the parent company per year. We were one of the largest franchises ranking around number 14 out of 7,000 offices worldwide.

We conducted over $1 billion in sales and generated over $25 million in commissions per year.

During 2007 the economy the real estate downturn and an internal misappropriation of funds financilaly effected our company.

Agents were not paying their monthly fees although we were required to pay the fees on their behalf or incur a 20% penalty. WE were required to pay about $84,000 per month therefore 20% would be very costly so we were forced to make those payments.

In 2007 our agent receivables totaled over $900,000 and we were financially crushed.

RE/MAX International offered to work with us on restructuring but all they did was allow other RE/MAX franchises to raid my company of my agents and production.

RE/MAX International alleged that they would work with me if we allowed agents that considered leaving my company to take their property listings although our policy called for us to keep 25% of any commission earned.

After they took my agents and listings they served me with a termination of franchise notice.

In addition they forced me to transfer back companies I purchased for upwards of $325,000 to the former owners for no monetary consideration.

They sued me in Colorado for about $500,000 for continuing franchise obligations although they terminated my franchise.

My attorney's filed counterclaims for around $13 million however we have run out of money to defend ourselves and legal fees of $120,000 plus were billed to us.

At the time I was having financial difficulties RE/MAX INternational was in the process of borrowing $295,000, 000.00 from Citi Bank who was concerned about giving the loan because CNN reported that 2000 RE/MAX offices were closing out of about 7,000 when in fact they should have reported that RE/MAX 2000 was closing 14 offices.

We are planning to write a book about the "Pitfalls of buying a real estate franchise" and looking for stories, testimonials, good news and bad.

Unfortunately we placed our company in bankruptcy because of the litigation cost and are looking for a contingency lawyer to handle our case.

We have over $500,000 in receivables and I believe a good case.

Similar stories from other RE/MAX owners around the country are pending and owners such as myself have lost millions of dollars.

Comments are welcome!

Company: RE/MAX International
Country: USA
State: Arizona
City: Gilbert

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