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A man who opened a "Shou Lao Ren" donburi restaurant franchise in Tainan was fined by the health bureau for using un-labeled sauces provided by the franchisor, leading him to sue for contract termination and compensation. The Tainan District Court ruled that the franchisor, Jin Gui Ren Wen Enterprise Co., Ltd., must compensate the franchisee for business losses but upheld the company's right to retain the franchise fee.

The franchisee, identified by the surname Huang, signed a franchise agreement in August 2023, paying a 400,000 NT dollar franchise fee and providing a 500,000 NT dollar promissory note. In late 2024, Huang discovered that the donburi sauces he received from the company only listed the product name on the packaging, violating food safety and hygiene regulations. Following a public complaint, the health bureau inspected the premises and fined Huang 30,000 NT dollars.

After the franchisor failed to rectify the issue despite Huang's demands, he terminated the contract in January. Huang then filed a lawsuit seeking the return of the franchise fee and promissory note, along with compensation for lost profits, rent, and wages during his closure, totaling 664,681 NT dollars. The company argued that they had operated for over a year, had complied with corrective measures upon notification, and that the franchise fee was for technical guidance. They also claimed Huang's request was unreasonable as he had re-rented the store after closing.

The court determined that the franchisor's provision of non-compliant ingredients constituted an "incomplete delivery," making Huang's contract termination lawful. Consequently, the company had to return the 500,000 NT dollar promissory note. However, the court rejected Huang's claim for the franchise fee, stating that the company had fulfilled its obligations regarding brand authorization and operational guidance, and the contract termination had no retroactive effect. Regarding business losses, the court calculated 32 days of losses based on Huang's monthly turnover of 348,938 NT dollars and an industry-standard net profit rate of 13 percent for restaurants, awarding 48,386 NT dollars. Claims for rent and wages were dismissed as they were already factored into the net profit calculation.