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Pizza Boli wants D.C. franchisee to go

A federal judge in Baltimore is likely to order a former longtime Pizza Boli’s franchise in Washington D.C., to significantly change the way it does business and may even shut it down for a time.

Presiding over a preliminary injunction hearing in the trademark infringement case Wednesday afternoon, U.S. District Judge Catherine C. Blake appeared unmoved by the defense attorney’s claims of discrimination and conspiracy and seemed skeptical of his legal arguments.

The franchisor, Baltimore-based Prosperity Systems Inc., wants Blake to order Nadeem Ali, a Silver Spring resident, to remove the Pizza Boli signs on his 12th Street NE store, take down its pizzabolisdc.com website and turn over all customer information gathered in the 12 years his family operated the franchise. After failing to resolve such issues earlier this year, PSI terminated Ali’s franchise on July 29.

PSI’s lawyer, Benjamin B. Reed, said Ali’s advertising and delivery outside of his previously authorized trade area had resulted in customers getting pies that are not up to the chain’s standards.

“It’s going to be cold, it’s going to be nasty and it’s going to reflect badly on Pizza Boli’s,” he said.

John E. Drury, the attorney for Ali, spoke slowly and forcefully in response but without meeting most of Reed’s arguments head-on.

Drury argued that PSI President Javed “John” Nasir, who started Pizza Boli’s in 1985, had it in for Ali because he ran a profitable business.

“Whenever there’s a successful Pizza Boli’s, the Nasir family moves in and terminates them,” Drury said. Alluding to other litigation in which Nasir has been involved, Drury said Nasir has “taken advantage of new Pakistani immigrants.”

Drury also contended the settlement of a different but related case in D.C. Superior Court in summer 2009 somehow superseded the franchise agreement.

“I don’t read it that way,” Judge Blake said. “That’s the problem I’m having.”

Blake did seem open to the possibility of Ali operating a pizza shop at his location under a different name. The franchise agreement includes a one-year noncompete clause.

Drury argued that PSI’s previous knowledge of Ali’s website constituted acquiescence, but eventually agreed his client would take it down. He said Nasir had diverted Internet orders away from Ali’s store. And he said Nasir’s brother, Mohammed Khalid, had not sold the American Pizza location a few blocks away from Ali’s store as required in the July 2009 settlement.

He implied that Nasir would rather his company or his family have an ownership stake in a lucrative franchise than simply collect monthly royalties. He said former employees of American Pizza, present in the courtroom, would testify about Nasir’s and Khalid’s strategies to this effect.

Reed said the theory that Nasir would prey on the most successful of his more than 60 franchisees in Maryland, Washington, Virginia and Pennsylvania doesn’t make sense. In the hallway outside the courtroom minutes later, Nasir also refuted that claim.

“This is absolutely totally wrong,” he said.

At the end of the roughly two-hour hearing, Blake said she would issue a written opinion “promptly.”