News & Analysis as of

Franchise Agreements

Before Franchising Your Business, First Consider These Factors

by Lewitt Hackman on

Franchising is so much more than casual burger chains with drive through windows and dollar menus. It’s an industry that incorporates a wealth of blue and white collar services; distributes both high- and low-end products...more

Valuing the Older Hospitality Facility Can Be Complicated

by Dickinson Wright on

Hospitality facilities built in the 1980s or 1990s (or earlier) tend to have design and layout configurations that are out of touch with a franchisor’s present market requirements. This jeopardizes the continued franchise...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

FRANCHISEE 101: Squeezed at the Pump

by Lewitt Hackman on

Most dealership and franchise agreements require the franchisor's prior written consent to the transfer of a business from one franchisee to another. The new franchisee is often required to sign the franchisor's then-current...more

Drafting Matters: When Non-Competes And Renewal Provisions Collide

by Fox Rothschild LLP on

If a franchisor waives the non-compete provision in its current franchise agreement, can it enforce a non-compete when the franchise agreement is renewed? According to a recent decision by the 9th Circuit Court of Appeals,...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

Gas Station Dealers: A Review of the Petroleum Marketing Practices Act

by Lewitt Hackman on

So far in 2017 no federal or state court in California issued a published decision under the Petroleum Marketing Practices Act (“PMPA”) – despite the fact gasoline demand and consumption continue to rise. The reason for fewer...more

Cable Operators Reduced Franchise Fee to Municipalities Not Permitted - BB&K Attorneys Win in California Federal Court

by Best Best & Krieger LLP on

For years, California cable operators have reduced the franchise fee paid to local governments by the amount paid to the California Public Service Commission. While a small amount for many communities, the deduction reduced...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

Food & Beverage Litigation Update | July 2017#3

EU to Issue Guidelines on Discriminatory Food Distribution - European Commission President Jean-Claude Juncker has reportedly indicated the EU will issue guidelines discouraging companies from selling apparently identical...more

Is Everything “Settled” In Your Settlement Agreement? Not Quite!

by Fox Rothschild LLP on

A recent case involving the Whataburger franchise system reminds franchisors of the importance of the use of iron-clad language when granting future development rights. In Whataburger, Inc. et. al. (“Whataburger”) v....more

Tennessee Business Court Requires Arbitration of Franchise Agreement Disputes Notwithstanding Provision for Application of...

by Butler Snow LLP on

The Tennessee Business Court, in For Senior Help, LLC v. Medex Patient Transport, LLC, Case No. 16-0553-BC, decided January 5, 2017, stayed litigation and compelled arbitration of the disputes arising under the parties’...more

Surcharge on Utility Users Imposed Under a Franchise Agreement is Not a Tax - California Supreme Court Holds Surcharge for...

by Best Best & Krieger LLP on

In an opinion anxiously awaited by many cities, the California Supreme Court held that a 1 percent surcharge on electric utility bills paid by Southern California Edison to the City of Santa Barbara, which were used for...more

District Court Protects Franchisor Against Anti-Contractual Competition in Frye

by Baker Donelson on

On Valentine's Day of 2017, the United States District Court for the District of Maryland gave franchisors the legal equivalent of two dozen roses when it decided Frye v. Wild Bird Centers of America, Inc., 2017 WL 605285 (D....more

Federal Court Rules Against Yum! Brands in Third-Party Franchise Sale Case – What Franchisors Need to Know

by Baker Donelson on

A federal court in Kentucky recently denied a franchisor's request to dismiss its franchisee's claim for intentional interference with prospective economic advantage. Based on this ruling, franchisors should proceed with...more

Franchise agreements under the South African Consumer Protection Act

by Dentons on

Prior to the enactment of the Consumer Protection Act 68 of 2008 (the CPA), there was no specific piece of legislation that regulated franchises. In this article, we provide a brief overview of some important aspects related...more

Is Your Agreement To Arbitrate Valid?

by Fox Rothschild LLP on

Many franchisors employ arbitration as its preferred method of dispute resolution. Generally, courts view arbitration agreements favorably. An agreement to arbitrate waives the fundamental right to have a court decide the...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: Contract Curveballs

by Lewitt Hackman on

In every Franchise Agreement, the franchisor and franchisee promise to fulfill obligations to the other. For some promises, whether or not they were performed can be a clear "yes" or "no." For example: either a franchisee...more

FRANCHISOR 101: State Taxes on Franchise Fees

by Lewitt Hackman on

Franchisors collect weekly or monthly "franchise fees." In many cases, fees are for particular services, such as marketing assistance or IT support. In franchising, the parties may be in any number of different states: for...more

Franchising Update

by K&L Gates LLP on

Many franchisors and other participants in the franchising sector are anticipating with concern the outcome of The Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017 (Bill) which was introduced into the Federal...more

Will Florida Cease to be the “Sunshine State” for Franchising? (Part 2/2)

by Fox Rothschild LLP on

Today, we continue our look at proposed changes to Florida’s franchise laws, including proposed changes in transferring franchised businesses, franchisor repurchase obligations and other miscellaneous changes...more

Will Florida Cease to be the “Sunshine State” For Franchising? 1/2

by Fox Rothschild LLP on

Two state legislators from Florida recently introduced a bill entitled “Protect Florida Small Business Act” (the “Act”), which could actually have the exact opposite effect on franchise relationships in Florida. While many...more

FRANCHISEE 101: Technical Disclosure Violations

by Lewitt Hackman on

The consequences to an unwitting franchisor can be severe when it fails to provide disclosure documents required by franchise law. Most franchise laws provide for rescission of the franchise agreement, allowing the franchisee...more

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