Hooters Agrees to Out-of-Court Settlement

Dispute over Former Executive's Appropriation of Confidential Information

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Apr 30, 2012, 05:02 ET

ATLANTA, April 30, 2012 /PRNewswire/ -- Hooters of America, LLC, has agreed to an out-of-court settlement of a federal lawsuit against a former Hooters executive and La Cima, a casual dining franchisee planning to open restaurants in the Southeast.

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The lawsuit filed by Hooters of America arose out of the Company's need to reverse the misappropriation of confidential and proprietary information taken by a former executive at the time of his separation from employment.

The litigation was initiated by Hooters of America in September of 2011, following a forensic investigation confirming that highly sensitive, confidential and proprietary information of the Company had been downloaded and transmitted to a personal email account by former Hooters Executive Vice President Joseph W. Hummel both immediately prior and subsequent to his July 2011 resignation from employment.

One month after Hummel resigned, a new company, La Cima, was formed with the stated intent to open 35 restaurants in the Southeastern United States. Hummel joined La Cima as a partner and chief operating officer.

Through the now resolved litigation, Hooters of America successfully secured the return and/or destruction of all of its misappropriated information, together with certifications from La Cima and Hummel that such information would not be used competitively in the future.

"Hummel and La Cima tried to defend their actions by claiming that Hooters' information was not adequately protected. While clearly not true, the defense and the settlement unmistakably concede that the information was indeed taken. We are obviously gratified that, through this litigation and the resulting settlement, La Cima and Hummel have been prevented from exploiting Hooters' proprietary information," said Claudia K. Levitas, General Counsel for Hooters of America.

About Hooters

Hooters of America, LLC is the franchisor and operator of over 430 Hooters restaurants in 44 states and 27 foreign countries. The first Hooters opened in 1983 in Clearwater, Florida. Hooters is well-known for its brand of food and fun, featuring a casual beach-theme atmosphere, a menu that features seafood, sandwiches, burgers, salads and Hooters world famous chicken wings, all served by the All-American Hooters Girls. For more information about Hooters visit www.Hooters.com, www.twitter.com/Hooters, www.YouTube.com/Hooters, or www.Facebook.com/Hooters.

SOURCE Hooters of America, LLC