A Japanese high court on Thursday dismissed an appeal by a man who claimed Seven-Eleven Japan Co.'s termination of his franchise contract was unjust, in a dispute that originated in his decision not to operate his store overnight.
The Osaka High Court said the chain operator's claim that the termination resulted from former franchisee Mitoshi Matsumoto's behavior toward customers was fair, upholding a lower court ruling ordering him to pay damages to the company.
The dispute between Seven-Eleven and Matsumoto, which began after Matsumoto's decision to cease 24-hour operations, shed light on the severe working conditions faced by many franchisees, leading to a re-examination of the industry's commitment to keeping convenience stores open all hours.
In February 2019, Matsumoto unilaterally stopped operations at his 7-Eleven store in Higashiosaka in Osaka Prefecture between 1 a.m. and 6 a.m., citing lack of staff.
Seven-Eleven terminated his contract on Dec. 31 that year after failing to come to terms with him, saying the decision was based on the fact that about 320 complaints had been received about his behavior between his store's opening in 2012 and October 2019, about nine times the national average.
Matsumoto, however, argued that the termination was retaliation for shortened business hours. He also said the complaints were due to the fact that his store dealt firmly with bad behavior by customers.
In June last year, the Osaka District Court said Seven-Eleven Japan, which at first had opposed shorter operating hours, had become willing to accept the move but that Matsumoto had failed to respond. It accepted the company's claim that the former owner had at times been rude toward customers and hurt the convenience store's image.
