When the Zajacs sued Pop-Ins in December 1985, joined by Brothers's seven strongest remaining franchisees, Pop-Ins was dead. Brothers had no royalties, no prospects, no cash flow, no staff, and no future; she could no longer escape her past. The list of plaintiffs arrayed against her read like the history of her journey from Columbiana to Palm Beach: Price and the Zajacx, Karp and Kane, ex-president Murphy, and almost every surviving franchisee and many that had gone out of business. Even Dale Kloss, her former lover, joined in, seeking restitution for a bounced check for $6,839.
On February 27, 1986, Brothers filed for Chapter 7 bankruptcy in U.S. Bankruptcy Court for the Southern District of Florida.
"It was the end of an eight-year dream, all my plans for a big exciting business," she recalled sadly. "You work hard for something, you strive all your life, then you watch it all go into the company, right down to the last thing. To have to sell your car to pay the bankruptcy attorney is devastating."
Brothers remained unrepentant after her fall. "If you want to say what I did wrong, it was make some poor choices in employees and franchisees," she said. "It could have worked, if I had had a good team behind me to help back me up and make things happen, so I wouldn't have to worry about an accounting problem here or an illegality there.
"I feel like I have been the victim of an awful lot of disloyal, conniving people. When I would tell someone that I was having problems with employees stealing files, they said I was paranoid. When I told them my franchisees are breaking away, they told me I was paranoid. But employees did steal files; that's an absolutely illegal act. And franchisees did break away, to avoid paying me royalties. They stole the system, and now they are turning the knife, getting the last laugh.
"There're a lot of them out there making a lot of money now, and they are making that money because they are following the system. If it was a bad system, they wouldn't still be making money in it."
Brothers finds their modest success bitter gall. They're out driving Eldorados, just as she promised them, and she had to sell her Corvette.
EPILOGUE
FOR THE FRANCHISEES, HARDENED BY THEIR YEARS of disappointment, news of Pop-Ins' bankruptcy came as a welcome relief. Free to find their own suppliers and set their own policies, with no royalty payments to make, many started to thrive. The Zajacs, Tom Bolles, the Kreitzes -- all have successful maid service businesses today, with the growth and return they'd hoped for when they first bought into Carol Brothers's franchise dream. Lynn Karp, the first franchisee to break away, now has 250 employees and two stores, and thanks to her success with Mopettes has become a familiar name in the local papers. Another former franchisee, Donna Arp, was doing so well with her two Texas Pop-Ins that she herself is now franchising under the Pop-Ins name, which she acquired legally earlier this year.
Most noticeable by their silence are the two outfilts that lay claim to protecting the public against business fraud and protecting the franchise industry from its unethical practitioners. During the months before the bankruptcy, a number of franchisees claim to have bombarded the Federal Trade Commission and the International Franchise Association with detailed complaints about Carol Brothers and Pop-Ins. Nothing was ever done.
The FTC, for its part, accepts no blame for fraudulent franchising activities. "We cannot protect people from franchisors we have not taken action on," explained FTC spokesperson Susan Ticknor in a stunning display of circular logic. She refused to comment on Pop-Ins, even to confirm or deny whether the agency had even received a complaint.
At the Washington, D.C., headquarters of the IFA, officials were also careful to distance themselves from any responsibility. IFA director of communications Geraldine Strozier insisted that membership in the IFA means consumers "can assume that the company has been scrutinized, and that it conforms to our code of ethics and is a company of substance." Pop-Ins' IFA membership, Strozier added, terminated in March, but only because of nonpayment of dues.
Strozier conceded that the IFA got four complaints about Pop-Ins, starting about six months before its membership ended. All complaints were forwarded to the ethical standards committee, she says, and the association wrote Brothers a letter. The IFA declined to make the letter available.
Andrew Kostecka, "Mr. Franchising" at the Department of Commerce, accepts no responsibility for Pop-Ins, either. "The girl did a good job," he maintains. "We aren't even talking large sums of money."
