Dunkin' Brands to increase legal reserves

Mon Jun 25, 2012 8:13am EDT
 
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(Reuters) - Dunkin' Brands Group Inc (DNKN.O: Quote), the parent of Dunkin' Donuts cafes and Baskin-Robbins ice cream shops, said it would increase its legal reserve in the current quarter following a court ruling against it in Canada.

A group of Dunkin' Donuts franchisees in Quebec had filed a lawsuit against the company in 2003 on a variety of claims.

The Quebec Superior Court ruled against Dunkin' Brands on Friday and ordered the company to pay C$16.4 million plus costs and interest to compensate the loss incurred by the franchises.

Dunkin' Brands, which operates in nearly 60 countries, said it had earlier reserved C$4 million for the potential loss.

The company said the damages awarded were unwarranted and it intends to appeal the decision.

Shares of the company closed at $34.72 on Friday on the Nasdaq.

(Reporting by Juhi Arora in Bangalore; Editing by Roshni Menon)

 
One pound bags of Dunkin' Donuts Original Blend coffee are on display at a Dunkin' Donuts store in Tewksbury, Massachusetts December 20, 2005. REUTERS/Jessica Rinaldi