A federal court in Missouri ruled that a franchisee’s fraud claim cannot be based on the franchisor’s prediction at a franchise expo of future success in the franchised business....more
5/29/2020
/ Burden of Proof ,
Dismissals ,
Due Diligence ,
Franchise Agreements ,
Franchisee ,
Franchises ,
Fraud ,
Misrepresentation ,
Negotiations ,
Puffery ,
Reasonable Reliance Claims ,
Trade Shows
A federal appeals court reversed dismissal of a claim against a barbeque restaurant franchisor. The court found that, despite having signed releases in favor of the franchisor, a former franchisee had valid claims for...more
5/5/2020
/ Actual Malice ,
Appeals ,
Breach of Contract ,
Business Partners ,
Buyouts ,
Covenant of Good Faith and Fair Dealing ,
Dismissals ,
Franchise Agreements ,
Franchisee ,
Franchises ,
Franchisors ,
Fraud ,
Restaurant Industry ,
Reversal ,
Tortious Interference ,
Unfair or Deceptive Trade Practices ,
Waivers
Ten years after the franchisor of the EXIT real estate system entered into a franchise agreement for a franchisee to operate an EXIT franchise in Maitland, Florida, the parties entered into another franchise agreement for a...more
7/31/2019
/ Appeals ,
Breach of Contract ,
Damages ,
Franchise Agreements ,
Franchisee ,
Franchisors ,
Fraud ,
Oral Contracts ,
Promissory Estoppel ,
Real Estate Transactions ,
Reversal ,
Statute of Frauds ,
Unjust Enrichment ,
Void and Unenforceable ,
Written Agreements
A commercial real estate relocation and consulting business franchisor (Relo) succeeded in getting a preliminary injunction to enforce a non-compete covenant against a former franchisee....more
Hot dog franchisor, Charlie Graingers, was unable to obtain dismissal of a federal lawsuit brought by franchisees alleging fraud, misrepresentation and breach of fiduciary duty....more
2/28/2019
/ Breach of Duty ,
Federal Trade Commission (FTC) ,
Fiduciary Duty ,
Franchise Agreements ,
Franchise Disclosure Document ,
Franchisee ,
Franchisors ,
Fraud ,
Misrepresentation ,
Motion to Dismiss ,
Release Agreements
Structuring a franchise to reduce risk of joint employment and vicarious liability means limiting a franchisor's control over franchisees. This is a challenge in a professional services franchise, where the brand is...more
4/2/2018
/ Code of Conduct ,
Control Test ,
Employee Misconduct ,
Franchise Agreements ,
Franchisee ,
Franchisors ,
Fraud ,
Joint Employers ,
Professional Services Contract ,
Tax Preparers ,
Vicarious Liability
Before a final agreement is signed there are often oral discussions, negotiations, and representations. There may be written memorandums of understanding or letters of intent. But, when the final agreement has a "merger" or...more
Most experienced franchisors know better than to make claims about profits franchisees can expect when those claims do not match the information in the franchisor's Franchise Disclosure Document. However, if a franchisor or...more
A recent Bankruptcy Appellate Panel decision is a reminder of both a benefit of bankruptcy, in appropriate circumstances, and the need to respect the bankruptcy discharge a party obtains in the process.
Mr. Lee was...more
FRANCHISOR 101: Franchisor Successfully Fends Off Fraud Claims -
There are circumstances when a fraud claim will not succeed against a franchisor. In Dunkin' Donuts Franchised Restaurants, LLC v. Claudia I, LLC, a...more