'Diner' Lease's Restrictive Covenant Ambiguous

June 27, 2014
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Facts: The restrictive covenant in a restaurant’s lease with a shopping center owner prohibited the owner from leasing to other “diner type” restaurants. When the owner began building out a portion of the center for a national specialty-hamburger restaurant and began negotiations with a restaurant serving soup and sandwiches, the tenant sued the owner for breaching its lease. The owner argued that the two new prospective tenants aren’t diners. Rather, they are so-called “fast casual” restaurants.

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