PITTSBURGH, Oct. 1, 2024 - GNC Holdings, LLC ("GNC"), the leading global health and wellness brand, announced that the International Centre for Dispute Resolution notified GNC of an award in its arbitrations against ONI Global Pte. Ltd., LAC Global (Singapore) Pte. Ltd., ONI Distribution Corporation, and Total Nutrition Corporation (collectively, "ONI/LAC Global") involving GNC franchises in Singapore and the Philippines.
The awards order ONI/LAC Global to pay GNC damages in the amount of US$5.28M for breaching their franchise agreements with GNC in the Philippines, and US$39.39M in net damages for breaching their franchise agreements with GNC in Singapore. In addition, the Singapore award orders ONI/LAC Global to assign the leases to 54 former GNC stores that ONI/LAC Global inappropriately novated and switched to LAC stores. Finally, the Tribunal found GNC to be the "prevailing party" in both Philippines and Singapore, and accordingly ordered ONI/LAC Global to pay a total of $8,734,787.15 related to GNC's attorneys' and administrative fees. GNC has moved to confirm and enforce the awards. The confirmation cases are pending in the U.S. District Court for the Western District of Pennsylvania (Case Nos. 2:2024cv01279 and 2:2024cv01280).
The awards highlight GNC's commitment to enforcing the terms of its franchise agreements and protecting its franchise system and brand globally. The tribunal found that ONI/LAC Global breached its franchise agreements with GNC in multiple ways, including:
Transferring operational control of GNC stores in Singapore to a competing brand, LAC, without GNC's approval.
Continuing to use GNC's proprietary marks and sell GNC products after terminating the agreements without cause.
Failing to meet its Minimum Purchase Amount obligations.
Selling products that GNC had expressly disapproved.
Further, the Tribunal found that ONI/LAC Global's counterclaims virtually all fail, including:
GNC's disapproval of direct purchase product did NOT breach the agreement
GNC's price increases did NOT breach the agreements
Product order delays did NOT breach the agreements
GNC did NOT breach its implied duty of good faith and fair dealing
These actions by ONI/LAC Global violated the agreements and damaged GNC's brand and reputation. GNC remains committed to being the global leader in health and wellness and will seek to ensure that all franchise partners are aligned with GNC values and operational standards.
Media Contact:
Nick Sero
Director of Public Relations
media@gnc-hq.com
412-246-9901
About GNC
GNC is a leading global health and wellness brand that provides customers with a wide variety of science-based products and solution services to Live Well. The brand touches consumers worldwide by providing its products and services through company-owned retail locations, domestic and international franchise locations, digital commerce and strong wholesale and retail partnerships across the globe. GNC's diversified, multi-channel business model has worldwide reach and a well-recognized, trusted brand. By combining exceptional innovation, product development capabilities and an extensive global distribution network, GNC manages a best-in-class product portfolio. www.gnc.com.
SOURCE GNC
