Tammy Taylor Nails: Did the Viljoens scam South African franchisees?

Did Tammy Taylor Nails SA tell the truth about its relationship with its US mother company?

It seems not, even after claiming in a recent press release that its relationship with the US mother company is intact.

Notice of intent to terminate license agreement

According to a letter dated 18 February 2021, from the mother company’s lawyers, Tammy Taylor USA had given  notice of intent to terminate its license agreement with Melany and Peet Viljoen who operated the South African company.

In their letter, the Californian license holder gave the Viljoens 30 days to cure their default, failing which the license would be “immediately terminated”.

The mother company sent this letter to one of the women who had complained to them, as evidence that it was intent on ending its relationship with the Viljoens.

ALSO READ: ‘It’s an African thing’: Tammy Taylor Nails responds to ‘misleading statements’

Tammy Taylor SA press release muddies the water

After they were questioned about this letter, Tammy Taylor Nails SA responded in a press release that it’s “most recent communication with Tammy Taylor USA – received on the 4th of May 2021 – confirms the continuation of a Distribution Agreement between the two parties.

“Tammy Taylor SA is the sole and exclusive distributor of Tammy Taylor USA’s products for the African and Australian continents. An excerpt from the above communication has been attached to this statement and the original document will remain available at Tammy Taylor Nails South Africa headquarters for perusal,” the press release read.

Redacted letter

A heavily redacted letter from the lawyers of the mother company to the Viljoens’ lawyer is then attached, with only one paragraph showing that reads: “As you know, the Distribution Agreement, more completely entitled, the International Distribution Agreement, was entered into between our clients on April 11, 2017. Subject to certain terms and conditions, the Distribution Agreement appointed the Viljoens to be “TTN’s sole and exclusive distributor … for the sale of Products within the Territory” of Australia and Africa.”

ALSO READ: Tammy Taylor Nails: empty and broken promises

The unredacted letter sent to Tammy Taylor Nails SA

However, when copying the letter from Acrobat and pasting the text into Microsoft Word, the redacted part became visible and it paints a completely different picture.

It reads: “Given the recent termination of the License Agreement, this letter is solely addressed to the Distribution Agreement between my client, Tammy Taylor Nails Inc., a California corporation (“TTN”), on the one hand, and your clients, Melany and Peet Viljoen (the “Viljoens”) on the other hand (the “Distribution Agreement”). On behalf of TTN I initially wrote you about the Distribution Agreement on April 30, 2021. This letter follows up that earlier communication.

“As you know, the Distribution Agreement, more completely entitled, the International Distribution Agreement, was entered into between our clients on April 11, 2017. Subject to certain terms and conditions, the Distribution Agreement appointed the Viljoens to be “TTN’s sole and exclusive distributor … for the sale of Products within the Territory” of Australia and Africa.

“One of the conditions of the Distribution Agreement is that the Viljoens “maintain and furnish” to TTN on request, “complete, accurate and current” business records regarding the distributorship, “including but not limited to detailed records on all Product sales and detailed information regarding names and addresses of all customers.” This is all specified in paragraph 4e. On April 30, 2021, TTN made such request on the Viljoens, requesting that the information sought be provided on or before May 10, 2021.”

It is not known what else is contained in the rest of the letter, but it does seem to confirm that the license agreement has in fact been finally terminated. The exact status of the distribution agreement however remains unclear.

ALSO READ: Tammy Taylor Nails franchise story goes horribly wrong for SA owners

Cease and desist letter to the Viljoens

The letters to the Viljoens were sent on to the woman who complained by Yiza Malave, director of international relations at Tammy Taylor Nails USA, who said in her letter that “It has proven necessary to give 30 days’ notice to terminate the Master License Agreement between Tammy Taylor Nails, Inc. (“TTN”) and Melany and Peet Viljoen (the “Viljoens”), by letter sent by legal counsel.

“A copy of the letter sent in that regard, dated February 18, 2021, is attached hereto. Absent the Viljoens curing their breach, after 30 days TTN will no longer provide or authorize the Viljoens to sell TTN’s products or use its trademarks.”

According to the letter of 18 February, regarding “Termination of Master License Agreement”, the lawyer writes that, “For the reasons stated below, TTN demands that the Viljoens, their Sublicensees, any and all persons or entities acting under their purview and authority, and any and all others in South Africa, unless given future, express written authority by TTN, hereinafter and forever cease and desist from selling, marketing, using, or otherwise promoting the Products, the Taylor Trademarks, and the Trademark Indicia (collectively, the “TTN IP”), in South Africa and/or anywhere else in the world.”

The lawyer states in the letter that the License Agreement gives the mother company the right to “audit the books and records of Licensee, including Licensee’s computer records and tax returns, with respect to the Salons and compliance with this Agreement.”

He also points out that on or about October 19, 2020, Susan Grueneberg, a lawyer on behalf of TTN, sent the Viljoens a Notice of Audit.

“Since then, now about four months, no responsive documents have been received. Accordingly, the Viljoens are, and have for some time been, in breach of paragraph 8.1.1. of the License Agreement.”

Grueneberg said in her letter, sent by email and also supplied by the mother company, that the “licensor” is conducting an audit and “demands” that they produce all business and personal records, bank statements, financial statements, tax returns, financial statistics, reports and any other relevant document and data containing true, accurate and complete information on:

• Gross sales reports for all salons for the past 24 months
• Product sales to each salon during the past 24 months
• Copies of all agreements between you and each existing salon and all other salons that have operated during any portion of the past 24 months
• Any communications from government or regulatory authorities you or the salons have received during the past 24 months
• Copies of any disclosure documents or other information you provided to salon owners prior to entering into agreements with them
• Default notices or warning letters or emails sent by you to salon owners
• Any litigation or other disputes between you and any salon during the past 24 months.

This information had to be provided no later than October 30, 2020, which apparently, it was not, prompting the 30-day final demand in February. Judging by the redacted May letter, that demand was also not met, resulting in the termination of Tammy Taylor SA’s license.

Did Tammy Taylor Nails SA pay back the money?

When The Citizen visited the Viljoens at their offices, they told her that the women who appeared in the Carte Blanche programme which initially blew the lid on the situation at Tammy Taylor, had all been refunded.

The women on Monday, however, denied that they have been refunded.

• Various requests for comment to the mother company as well as its lawyers and Tammy Taylor Nails SA went unanswered for almost two weeks.

With the blessing of the president?

Tammy Taylor Nails SA shows on its website, under “giving back”, that staff made masks that were handed out to various groups, including the police.

The card below seems to allege that even president Cyril Ramaphosa wrote to thank them. The presidency did not answer a request for confirmation.