Welcome to The Franchise Memorandum by Lathrop GPM. Below are summaries of recent legal developments of interest to franchisors.

Missouri Federal Court Holds Franchisor Controls Sufficient to Survive Motion to Dismiss Joint Employer Claim -

A federal court in Missouri recently denied a motion by McDonald’s to dismiss an employment discrimination claim brought against it by a franchisee’s former employee. Johnson v. McDonald’s Corp., 2021 WL 2255000 (E.D. Mo. June 3, 2021). Barbara Johnson briefly worked at a McDonald’s franchise before quitting after allegedly being sexually harassed and assaulted. In her subsequent employment discrimination complaint, she alleged that she was an employee of the franchisor McDonald’s, describing her franchisor-issued application form, franchisor inspections of franchisee operations, and training provided by McDonald’s to the franchisee that included the topics of sexual harassment prevention and reporting. McDonald’s moved to dismiss the complaint on the basis that she failed to plead facts sufficient to establish that McDonald’s was her joint employer or that the franchisee acted as its agent.