*

After examining the briefs and the record, we have concluded that oral

argument is unnecessary. Thus, the appeal is submitted on the briefs and the record.

See Fed. R. App. P. 34(a)(2).

United States Court of Appeals

For the Seventh Circuit

Chicago, Illinois 60604

Submitted February 14, 2007*

Decided February15, 2007

Before

Hon. MICHAEL S. KANNE, Circuit Judge

Hon. ILANA DIAMOND ROVNER, Circuit Judge

Hon. DIANE S. SYKES, Circuit Judge

No. 06-3319

JAMES A. ZEIDLER,

Plaintiff-Appellant,

v.

A&W RESTAURANTS, INC.,

Defendant-Appellee.

Appeal from the United States District

Court for the Northern District of

Illinois, Eastern Division.

No. 03-C-5063

Wayne R. Andersen,

Judge.

O R D E R

James Zeidler’s A&W restaurant—which he operated pursuant to a franchise

license agreement with A&W Restaurants, Inc. (“A&W”)—never turned a profit. 

Zeidler closed the restaurant because “he could not continue to subsidize it,” then

filed this diversity suit under Illinois law claiming that A&W wrongfully terminated

and breached the license agreement and committed fraud. Zeidler appeals the

district court’s grant of summary judgment for the defendants, and we affirm. 

Because Zeidler did not respond to A&W’s motion for summary judgment in

NONPRECEDENTIAL DISPOSITION

To be cited only in accordance with

 Fed. R. App. P. 32.1
No. 06-3319 Page 2

the manner required by Local Rule 56.1(b)(3), the district court adopted A&W’s

statement of facts. On appeal Zeidler does not challenge that aspect of the court’s

decision, so our de novo review of the court’s grant of summary judgment will rest

on A&W’s version of the facts. See Koszola v. Bd. of Educ. of Chi., 385 F.3d 1104,

1109 (7th Cir. 2004). 

In July 1996, Zeidler and A&W entered into a written license agreement that

allowed Zeidler to open and operate an A&W restaurant in Streamwood, Illinois. 

Zeidler agreed to comply with the standards set forth in A&W’s Operations Manual,

which explicitly required him to “actively participate in the Restaurant business,”

and to ensure that the restaurant is open for ten hours a day no fewer than 360

days every year. The license agreement stressed this point: A&W would have

grounds for termination if Zeidler “cease[d] to operate . . . or otherwise abandon[ed]”

the restaurant.

Soon thereafter A&W learned that a Dairy Queen restaurant would open

next to Zeidler’s proposed location, and A&W tried to persuade him to cancel the

agreement. A&W warned Zeidler that the Dairy Queen would decrease his

restaurant’s viability, that he would suffer great losses if he proceeded with opening

the restaurant, and that A&W would not have approved the proposed location had

it known about Dairy Queen’s plans. A&W offered to refund the entirety of his

franchise fees and equipment orders, but Zeidler ignored the warnings and opened

the restaurant in March 1997.

Things at the restaurant went badly from the start. In the summer of 1997

A&W sent Zeidler two letters informing him that his restaurant was not meeting

A&W’s standards and specifications. Zeidler had trouble keeping his restaurant

clean and had to fire several employees for theft. Zeidler also refused to submit

profit and loss statements; A&W informed him that this “reprehensible”

transgression was a violation of the Agreement. In the fall of 1998, Zeidler

informed A&W that he intended to sell, lease, or close his restaurant because it was

“losing a lot of money.” He asked A&W for permission to close his restaurant for

the winter because of its poor sales, and A&W granted his request.

Zeidler reopened the restaurant for the spring and summer of 1999, but in

September 1999 he asked A&W for permission to close the restaurant again for the

winter. Without waiting for a response, Zeidler closed the restaurant for eight days

and began trying to sell the property. A&W promptly granted Zeidler’s request to

close for the winter beginning October 1st, but stated that he had to reopen by the

following spring. The restaurant closed for the winter, and never again opened.

In April 2000 Zeidler wrote A&W the first letter in a string of correspondence

relating to his failure to reopen the restaurant. In that letter, he informed A&W

that it would be “impossible” for him to reopen. A&W requested an explanation and
No. 06-3319 Page 3

informed Zeidler that he had breached the license agreement. Zeidler responded

that it was impossible for him to reopen because he could “no longer continue to

subsidize” the restaurant. Zeidler offered to sell A&W the restaurant, but it

declined and reiterated to Zeidler that his failure to operate the restaurant

constituted a breach of their license agreement. In early March 2001, Zeidler sent

A&W a letter demanding that it provide him with its franchisee mailing list, but did

not mention any plans to reopen the restaurant. A&W responded by letter of March

15, stating that Zeidler had abandoned the restaurant and “expressly reserv[ing] all

rights and claims it may have with respect to Mr. Zeidler’s abandonment of the

restaurant.” By that time, the restaurant had been closed for a year and a half.

Zeidler sued A&W, alleging that it violated the Illinois Franchise Disclosure

Act (“IFDA”), 815 Ill. Comp. Stat. § 705/1 et seq., by terminating the license

agreement without good cause. He also claimed breach of contract, alleging that

A&W ignored his requests for information he needed to reopen his restaurant. 

Zeidler also alleged fraud arising out of comments from A&W’s former chief

executive officer (“CEO”) suggesting that the company knew before 1996 that freestanding A&W restaurants were not viable. The CEO had acknowledged in a 2002

investment relations broadcast that “when we bought the company, we realized we

could not build free-standing buildings on corners—the unit economics simply

wouldn’t justify that.” Zeidler alleged that A&W’s failure to warn him in 1996 that

the unit economics would not justify free-standing buildings constituted fraud. The

parties filed cross-motions for summary judgment. 

The district court granted A&W’s motion and denied Zeidler’s, reasoning that

Zeidler’s abandonment of the restaurant placed him in material breach of the

license agreement, and this breach barred his wrongful termination and breach of

contract claims. It also found that Zeidler’s breach of contract claim failed because

the evidence he submitted of A&W’s purported refusal to communicate with him in

the beginning of 2001 did “not rise to a level of unresponsiveness that would

prevent Zeidler from reopening.” The court also rejected Zeidler’s fraud claims

because A&W’s failure to disclose its former CEO’s understanding of the viability of

free-standing buildings neither induced Zeidler to enter the license agreement nor

injured him.

On appeal Zeidler first argues that the district court misunderstood his IFDA

claim; he states that “the pertinent issue” is not whether A&W wrongfully

terminated the license agreement, but whether A&W violated the IFDA by never

issuing a notice of termination, thereby leaving him “in contractual limbo.” But

that is not the claim Zeidler alleged in his complaint. There, he repeatedly referred

to the March 15 letter as a notice of termination and claimed that A&W violated the

IFDA by “terminating the franchise without good cause . . . .” Zeidler is bound by

his complaint’s characterization of the March 15 letter as a notice of termination,

see Crest Hill Land Dev. LLC v. Joliet, 396 F.3d 801, 805 (7th Cir. 2005); Help at
No. 06-3319 Page 4

Home, Inc. v. Med. Capital LLC, 260 F.3d 748, 753 (7th Cir. 2001), and he cannot

avoid summary judgment by now denying that A&W ever issued a notice of

termination.

This late shift in Zeidler’s IFDA claim is likely his attempt to skirt the rule

that a franchisee who abandons his franchise by closing it before the end of the

license agreement’s term cannot prevail on a wrongful termination claim under the

IFDA against the franchisor. See (Russell) Zeidler v. A&W Restaurants, Inc., 301

F.3d 572, 574 (7th Cir. 2002). We articulated that rule in a factually similar case

brought against A&W by Zeidler’s brother, Russell. There we held that by closing

his restaurant and removing its equipment twelve days before receiving a notice of

termination, Russell had abandoned the franchise and could not sustain a wrongful

termination claim against A&W. Id. Here, Zeidler closed his restaurant for more

than 550 days before receiving a letter that he claimed constituted a termination

notice. Zeidler’s prolonged failure to reopen his restaurant despite A&W’s warnings

that the closure breached the agreement precludes his wrongful termination claim

under the IFDA. Id. 

Zeidler’s arguments with respect to his breach of contract claim are difficult

to parse, but he appears to argue that A&W breached the license agreement in two

ways: first, by failing to issue a notice of termination; and second, by refusing to

communicate with him. The first argument, however, is undermined by his breachof-contract claim, which states that A&W faxed him a notice of termination on

March 15, 2001, and he is again bound by that characterization. See Crest Hill

Land Dev. LLC, 396 F.3d at 805. The second argument ignores the district court’s

conclusion that his breach of contract claim lacks a factual basis. Zeidler points to

no evidence that calls into question the court’s finding that the few attempts Zeidler

made to communicate with A&W from December 2000 through March 2001 “do not

rise to a level of unresponsiveness that would prevent Zeidler from reopening.” 

Because Zeidler has not demonstrated a genuine issue of fact as to whether his

failure to reopen the restaurant in March 2001 was caused by A&W’s

unresponsiveness, summary judgment was appropriate with respect to his breach of

contract claim.

Finally, Zeidler renews his arguments that A&W committed fraud—under

the Illinois Consumer Fraud Act, the IFDA, and common law—by failing to warn

him of the CEO’s belief that free-standing A&W restaurants were not viable. He

argues that A&W deceived him by selling him a franchise knowing it would not

succeed.

The IFDA claim fails because although Zeidler claimed wrongful termination

under the IFDA, he never made a fraud claim under that statute. As the district

court correctly noted, this court has held that the summary judgment stage “is too

late in the day to be adding new claims.” Auston v. Schubnell, 116 F.3d 251, 255
No. 06-3319 Page 5

(7th Cir. 1997). 

The Illinois Consumer Fraud Act and common law fraud claims are also

meritless. These claims require Zeidler to show that A&W misrepresented or

concealed a material fact. See Miller v. William Chevrolet/Geo, Inc., 762 N.E.2d 1,

12 (Ill. App. Ct. 2001); Connick v. Suzuki Motor Co., 675 N.E.2d 584, 595 (Ill. 1996);

Check v. Clifford Chrysler-Plymouth of Buffalo Grove, Inc., 794 N.E.2d 829, 835 (Ill.

App. Ct. 2003). But this he has not done. He asserts that A&W concealed its

knowledge that free-standings buildings were not viable restaurant locations, but

cannot point to any evidence to dispute A&W’s position in its statement of

facts—accepted as true for purposes of our review—that in 1995 it approved freestanding restaurants when the particular characteristics of a proposed site

suggested it was an economically viable location. In any event, the alleged

nondisclosure is material only if Zeidler would have acted differently knowing the

information. See Connick, 675 N.E.2d at 595. As the district court pointed out,

A&W upon learning of the proposed Dairy Queen urged Zeidler not to proceed with

his plan to open the restaurant. Indeed, A&W went so far as to warn him that his

losses would be greater if he went forward with the project than if he withdrew, and

offered even to refund his franchise fees and equipment orders. Because Zeidler

cannot show that A&W concealed a material fact, the district court properly granted

A&W summary judgment on Zeidler’s fraud claims. 

AFFIRMED.