fbpx
Connect with us

Social Stories

What’s Happening Between La Kaffa And Loob Holdings?

Published

The Drama Between La Kaffa Vs Loob Holdings - World Of Buzz 4

Follow us on Facebook, Youtube, Twitter, and Instagram for the latest stories and updates daily.

It’s like an amped up game of ‘he said she said’, with lawyers and lawsuits.

Back in January, Malaysians were shocked when they heard the news of La Kaffa’s decision to terminate the contract with Loob Holding for Chatime.

The Drama Between La Kaffa Vs Loob Holdings - World Of Buzz

According to La Kaffa, they made the decision to terminate the contract with Loob for breaching the master franchisee contract.

La Kaffa released statements explaining their decision, to which Bryan Loo of Loob Holding has a steady rebuttal.

The reasons are as follows:

1. Third party involvement

La Kaffa

La Kaffa started getting suspicious when they noticed how the revenue for the Chatime Malaysia stores were increasing but the purchase of raw materials from the main branch was decreasing.

To get to the bottom of this, La Kaffa sent a few undercover representatives to various outlets to get evidence. It must have been successful as the parent company claimed to even have video evidence. they specified three main ingredients; milk tea powder, cocoa powder and polypropylene (PP) cups.

La Kaffa’s cups contain “YM-500” or “YM-700” markings on its base to confirm its genuinity. Investigations in Malaysian Chatime outlets revealed that these cups had been replaced.

Loob Holdings

Loo said that the only unapproved ingredients they got were through partnerships with brands like Horlicks and Cadbury.

He added that the company did that for them to be localised and stay relevant throughout the years.

 

2. The request to see books were denied.

La Kaffa

Since La Kaffa still wasn’t convinced by the reasons given by Loob Holding, they exercised their rights to inspect and audit the books of Loob under Article 10(iv) of the Regional Exclusive Representation Agreement (RERA).

The Drama Between La Kaffa Vs Loob Holdings - World Of Buzz 2
Source: burgie law

Loob Holdings

However, this request was denied by Loob.

 

3. Outstanding royalty due

La Kaffa

Under the RERA, it’s compulsory for Loob to make full payment for the purchase of raw materials. However, there is an outstanding sum of a whopping USD713,273.72 (RM3,174,000) which was also the subject of matter in the arbitration filed by La Kaffa in the Singapore International Arbitration Centre. However, the amount claimed was then reduced to USD644,536.32 (RM2,870,000)

Loob Holdings

On the other hand, Loo explained that under the advise of their lawyers, Loob Holding held back their payment for the past quarter. However, Loo could not explain further as the details are part of the arbitration proceedings which should remain private and confidential.

 

4. Non-competition

La Kaffa

La Kaffa mainly relies on Section 27 of the Franchise Act 1998 which provides prohibition against similar business.

What is ‘similar business’? It includes colour scheme, ingredients, sauces, food type, logo, food labelling and packaging.

Loob Holdings

With Loo’s announcement of the majority of Chatime outlets to be turned to Tealive, this has undeniably become La Kaffa’s main concern.

The Drama Between La Kaffa Vs Loob Holdings - World Of Buzz 1

La Kaffa has allegedly provided various manuals and operation training manuals to Loob which contain unique information with an incredible amount of money and effort.

Concerns were raised higher when Loo said in an interview that “the same team, the same people, both employees and partners, in place at the same outlets…” to which La Kaffa finds it highly unlikely.

In accordance to this, Loo said the company would move forward in its growth story with its 1,000-strong workforce who were serving two million customers each month.

In the same interview, Loo mentioned that they expect consumers to find that they have a different name but only better; working closely with sub-franchisees, outlet supervisory staff, frontline workers, partners and associates.

“We will surely come up with something better. Loob Holding has 10 brands under us, including this Taiwanese brand which we built from scratch in Malaysia – from zero to hero and from no outlet to the current 165,” said Loo.

For a more extensive report, you can read it here.

As days pass, the bubble tea drama seems to intensify. Whose side are you on?

Follow us on Facebook, Youtube, Twitter, and Instagram for the latest stories and updates daily.



Just In

Collage 89 Collage 89
News10 hours ago

Johor Government May Implement a 4.5-Day Workweek in the Near Future

A 4-day workweek sounds ideal, but a 4-and-a-half day workweek doesn’t sound bad either. Johoreans may be in luck next...

My Post 1 2024 11 21T160023.537 My Post 1 2024 11 21T160023.537
News12 hours ago

“UPSR get D, SPM can get A” – PMX Responds to BERSIH Giving Him a Grade D in ‘Report Card’

Prime Minister Datuk Seri Anwar Ibrahim has opened up about BERSIH’s ‘report card‘ on his administration’s performance in conjunction with...

My Post 1 2024 11 21T114442.032 1 My Post 1 2024 11 21T114442.032 1
News16 hours ago

PDRM is Offering 60% Off Selected Traffic Summons at Govt’s 2nd Anniversary Event This Weekend!

In conjunction with the MADANI government’s 2nd anniversary on 24 November (Sunday), the Ministry of Home Affairs of Malaysia (KDN)...

Collage 17 1 Collage 17 1
News1 day ago

MCPF Calls for Vape Ban, Warns Addiction to Substances Can Lead to Unhealthy Behaviours Like Theft

The Malaysian Crime Prevention Foundation (MCPF) is urging for the sale of e-cigarettes or vape devices to be banned or...

Feat Image Lesen Feat Image Lesen
News1 day ago

Anthony Loke: Road Users in M’sia May Have to Pay for Physical Driving License Cards Starting Next Year

Transport Minister Anthony Loke Siew Fook today iterated that the Government will continue with the implementation of digital driving licenses...

Collage 15 2 Collage 15 2
News1 day ago

Filipino Couple Caught Living & Working Illegally in Malaysia Using Fake MyKads That Cost RM250 Each

A Filipino husband and wife were arrested during a raid on November 19 at a house in Pandan Indah yesterday...

Feat Image Apple Ind Feat Image Apple Ind
News1 day ago

Apple Offers to Increase Investment in Indonesia Tenfold to RM446 Million to Lift Country’s iPhone 16 Series Ban

Previously, we shared how the Apple iPhone 16 Series is banned from being sold in Indonesia until the tech giant...

My Post 1 2024 11 20T144359.263 My Post 1 2024 11 20T144359.263
News2 days ago

BERSIH Names Ismail Sabri the Best PM Since 2009, Calls Out PMX for Lack of Urgency with Reforms

In conjunction with the upcoming 2nd anniversary (24 November) of Anwar Ibrahim’s administration, The Coalition for Clean and Fair Elections,...

Announcement

Latest Videos



TRENDING TODAY