Dunkin' Donuts sues local franchisee over allegedly fraudulent charity donations

Dunkin' Donuts yesterday filed suit against the owners of four local franchises, alleging they tried to use a company charity fund to pay for their son's tuition at an exclusive private school.

In its suit against Houman and Heather Baiany, who own Dunkin' Donuts shops at 530 and 1020 Commonwealth Ave. in Boston and 154 Highland Ave. and 850 Broadway in Somerville, the chain charges the two tried to put one over on its "marketing development fund," which lets Boston-area franchisees get reimbursed for up to $2,000 per store each year for donations to local charities.

On Nov. 2, Dunkin' Donuts says, the Baianys submitted two reimbursement requests to the fund, one for $3,450 and one for $4,048.46, for contributions to the Belmont Hill School, along with a thank-you letter signed by school principal Richard Melvoin. Thinking the amounts were kind of odd, and noting "grammatical and typographical errors" in a letter from a school principal, however, fund administrators decided to check with the school. According to the suit, the school responded that the letter was forged and that the checks the Baianys had submitted were for payment of tuition and bookstore charges for their son, a student at the school.

The lawsuit, filed yesterday in US District Court in Boston, seeks lots of money for the alleged damage to Dunkin' Donuts' reputation and an order requiring the couple to strip the chain's identity from their stores and products.

Complete complaint.