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Franchise Civil Procedure General Business

Read need-to-know updates, commentary, and analysis on Franchise issues written by leading professionals.

When a Warehouse Is a 'Place of Business' Under the New Jersey Franchise Practices Act

by Pepper Hamilton LLP on

A recent federal court opinion overlooked a plain-language requirement of the “place of business” element of a claim under the New Jersey Franchise Practices Act (NJFPA), N.J.S.A. § 56:10-1 et seq., potentially expanding the...more

Franchisor's Racial Animus Is Irrelevant in Determining Legality of Franchise Termination Under NJ Franchise Practices Act

by Pepper Hamilton LLP on

In a recent win for franchisor 7-Eleven, Inc., the U.S. Court of Appeals for the Third Circuit upheld a New Jersey district court’s ruling that 7-Eleven properly terminated its franchise agreements for cause based on the...more

California Courts Continue to Void Forum Selection Clauses in Franchise Agreements Under a Questionable Mutual Assent Theory

by Mulcahy LLP on

The Ninth Circuit and California Court of Appeal generally continue to render forum selection clauses in franchise agreements unenforceable. This has been a hot topic among franchise litigators and on our blog....more

Franchise Litigation Rising Over Dietary Considerations

by Lewitt Hackman on

Rising concerns over food sourcing and preparation is leading to more and more litigation for restaurants and franchises. Most of the lawsuits claim discrimination, which makes sense as many dietary strictures are rooted...more

FRANCHISOR 101: Selective Enforcement of Franchise Agreement Provisions

by Lewitt Hackman on

A franchisor's ability to set renewal terms can bind franchisees to terms in a later franchise agreement before the renewal agreement even exists. In a recent case, a franchisor could enforce a hypothetical non-compete...more

Navigating The Private Right Of Action Under The California Franchise Investment Law

by Mulcahy LLP on

The California Franchise Investment Law (“CFIL”) regulates both the sale and disclosure of franchise opportunities within the state. The law was enacted to “provide each prospective franchisee with the information necessary...more

License to Sue? Court Rules That a Motor Vehicle Dealer Does Not Need a Dealer’s License to Bring a Statutory Claim for...

by Mulcahy LLP on

California’s motor vehicle code allows dealers to bring suit against manufacturers for terminating the dealer without good cause. See California Vehicle Code §§ 11713.3, 3060, 3061 and 3066. As currently written, the...more

FRANCHISOR 101: Donut Franchise Relationship Dissected by Court

by Lewitt Hackman on

The parent of Dunkin' Donuts was named along with Starbucks and about 80 other coffee sellers, distributors and retailers in a 2010 lawsuit alleging violations of California's Proposition 65 and Safe Drinking Water and Toxic...more

Franchisors, Got Claims? Don't Let Them Spoil Like Bad Cheese

by Lewitt Hackman on

This is the tale of two restaurants, each facing trademark infringement claims under the Lanham Act brought by two, separate franchisors. The franchisees’ restaurants had three things in common: First, cheese is a key...more

FRANCHISEE 101: Special Delivery

by Lewitt Hackman on

For a relationship to meet the legal definition of a "franchise" in some jurisdictions, the franchisor must give significant assistance to, or have significant control over, the franchisee's business. A franchisor's...more

Tesla “Franchisee” Thwarted in Utah

by Fox Rothschild LLP on

Tesla, the electric vehicle automaker, recently lost a round in the Supreme Court of Utah. Tesla set up a wholly-owned subsidiary called “Tesla UT” that was to hold a license to sell Tesla’s cars to the public. The Utah...more

Sheppard Mullin Secures Major Victory for Chipotle in Nationwide Misclassification Action By Demonstrating Variations Among...

The Court’s opinion in Scott v. Chipotle Mexican Grill demonstrates how employers can successfully combat class action claims that employees were misclassified as exempt. The successful defense of the class certification...more

FACTA Suits Still Bite - $31 Million Subway Class Action Settlement Approved

Ten years ago, hundreds of retailers, chain restaurants and others were targeted nationwide as defendants in class action suits under the Fair and Accurate Credit Transactions Act (FACTA) for violating the so-called...more

Court Finds That Arbitration Award That Interpreted Contract “Termination” To Include Contract “Expiration” Was Not A “Manifest...

by Carlton Fields on

Former franchisees filed a petition to vacate an arbitration award entered in favor of their former franchisor which enforced a 2-year non-compete provision in the parties’ franchise agreement when the agreement expired. The...more

Court Grants Default Judgment Confirming Arbitration Award, With A Lesson On Jurisdiction

by Carlton Fields on

Choice Hotels filed an application to confirm an arbitration award of over $247,000 for the alleged breach of a franchise agreement by two defendants, which failed to timely commence construction of a hotel. The defendants...more

THANKSGIVING EDITION [FROM THE ARCHIVES]: Court Protects Quizno’s Franchise Turkey Trade Secrets

This Thanksgiving, Trade Secrets Watch is serving a delicious tale about protecting trade secrets in a franchising relationship. In 1994, Quizno’s entered into a franchise agreement with Robert Kampendahl, an...more

FRANCHISEE 101: Is It a Franchise? Yes and No

by Lewitt Hackman on

A federal court in Indiana made an interesting decision on whether a business relationship was a franchise. Wabash National Corp. is a famous maker of semitrailers. Wabash notified a dealer in Texas that its dealership was...more

September 2016 Independent Contractor Misclassification and Compliance News Update

by Pepper Hamilton LLP on

The past month’s judicial and administrative activity in the area of IC misclassification reflects the wide range of industries facing these types of claims: communications; cleaning services; transportation and delivery...more

Lessons Unlearned: Franchise and Independent Contractor Agreements Can Be Kiss of Death

by Pepper Hamilton LLP on

The Third Circuit’s decision is a pointed reminder to franchisors, as well as businesses that use independent contractors, that the form of their agreements can either serve their legal interests or harm them in employee...more

FRANCHISEE 101: How Far Do Earnings Projections Go?

by Lewitt Hackman on

A franchisor is allowed to make "financial performance representations" in its disclosure documents. These figures may project how much money a franchisee is likely to make and can play a critical part in the franchisor's...more

Government Involvement in Noncompetes… Against a Sandwich Maker?! Jimmy John’s Slapped With Another Lawsuit, This Time Brought by...

Jimmy John’s can’t seem to escape the limelight. Last year, the company made headlines when employees hit it with a putative class action lawsuit seeking to invalidate their non-compete agreements. The District Court...more

Sixth Circuit Tri County Decision Provides Much-Needed Clarity on “Successor” Provision in Ohio Franchise Law

by McDermott Will & Emery on

I attach a copy of the US Court of Appeals for the Sixth Circuit’s recent decision in Tri County Wholesale Distributors v. Labatt USA Operating Company, Nos. 15-3710/3769 (6th Cir., July 6, 2016). For students of the...more

Sign O’ The Times: SCOTUS Denies Cert In Franchise Arbitration Dispute

On Monday of this week, after stringing the parties along for five months, SCOTUS denied cert in a case involving the intersection between arbitration and franchise regulation. The petition was filed in November of 2015,...more

Ninth Circuit: Arbitration Provision Contained In Sham Agreement Is Not Enforceable

by Carlton Fields on

The Ninth Circuit reversed a district court ruling that had compelled arbitration, holding that a party may not enforce an arbitration agreement where the clause is contained in a nonbinding contract. The parties had entered...more

Spotlight on Tennessee: Forced Franchise/Excise Tax Variance Upheld by Supreme Court

by Baker Donelson on

On March 23, 2016, the Tennessee Supreme Court issued its much-awaited decision in the case of Vodafone Americas Holdings, Inc. et al. vs. Tennessee Commissioner of Revenue....more

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