A former franchisee of the popular Dunkin’ Donuts chain has sued the company for racial discrimination.

Priti Shetty, former owner of two Dunkin’ stores, one in Wantage and the other in Oak Ridge, N.J., has accused the franchise of discriminating against “Asian Indian-American women of color” for refusing to allow her to open a third store but later allowing another applicant, a man,  to open a store at the same location. The suit was filed May 11 at the Superior Court of New Jersey in Middlesex County.

Shetty, of Monteville, N.J., is a graduate of Bombay University with a degree in engineering and has worked with Fortune 500 companies and financial companies as an IT professional. When her husband, Sandesh, bought three Dunkin’ franchises for $50,000 each in 2004-05, he asked her to manage two stores in 2006. Shetty told Desi Talk she ran them for a profit as the couple looked for a third site to set up shop.

According to Dunkin’s franchising rules, a franchisee has to buy three spots at one time. In 2007, Shetty identified a site in Stockholm, N.J., but Dunkin’ refused her the franchise on grounds that it did not have the facility for a drive-through window.

In her court filing, a copy of which was made available to Desi Talk by her attorney Gerald Marks, Shetty claims Dunkin’ allowed another person to open a store at the same site soon after rejecting her application.

She said she sold the stores in 2010 because she was harassed by Dunkin’s brand representative. “Unfortunately, the lease Priti had signed had a personal guarantee so when the two stores failed under the new franchisee, Priti was stuck with the guarantee and asked Dunkin’ to let her take back the stores,” Marks told Desi Talk.

“Dunkin’s discriminatory decision not to let her (Shetty) resume operations caused her to sustain economic damages in that she now has to defend a suit commenced by her former landlord for unpaid rent for the empty store,” according to the complaint. “I wanted to do this (sue Dunkin’) even when I owned the stores because it was just impossible with the constant harassment from them (Dunkin’ Donuts) – like walking into my store, yelling at my employees, compelling me to be at the store even when my daughter was sick, making me keep the store open 24 hours even though it was an unsafe location,” Shetty told Desi Talk.

The twenty-four hour operation was dropped after an employee was attacked one night hours and the shopping center landlord insisted that the Dunkin’ store not operate during night hours because of safety concerns. “Dunkin’ agreed only after the landlord of the strip mall gave final notice,” Shetty said.

She says the problems began happening when a new brand representative, Wayne Miller, took over. “And I think this manager had a problem with me running it. He expected me to be docile and accept his decisions even if it meant losing money. It was a very rough ride,” Shetty said. Currently, she is a consultant with Ernst & Young, she said. A Dunkin’ spokesperson told the New York Post the company was not aware of the lawsuit.

According to Marks, the complaint has yet to be served to Dunkin’.  He told Desi Talk it is a racial discrimination suit. “There are two things going on. Under New Jersey’s Law Against Discrimination, or LAD, you cannot discriminate in appointments or in commerce. In addition, being an Asian American woman of color, Priti is protected under the U.S. Civil Rights Code.”

 “They hounded her out of business because she was an Indian woman and wouldn’t let her get back in because she was an Indian woman,” Marks said.