Franchise Agreements

News & Analysis as of

When a State Franchise Law Imposes an Obligation That Federal Law Preempts: What Dickey's Means for Franchisors

Have you ever been required by a state franchise regulator to include in your franchise agreement or disclosure document a provision that you believe he or she does not have the legal right to require? This issue often...more

Kuwait introduces new Agency Law: franchisors take note

The State of Kuwait recently enacted Law No. 13 of 2016 (the Agency Law) on the regulation of commercial agencies in Kuwait, explicitly overturning the former agency law. The Agency Law introduces material changes to 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

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

EU & Competition Law Update – April 2016

European Union: EU Commission maintains close scrutiny of retail geo-blocking - On the 18th of March 2016, the EU Commission published initial findings from its e-commerce sector inquiry. The initial findings show a...more

Franchisee Can’t Work Its Way Out of Trademark Infringement and Breach of Contract Litigation on Jurisdictional Grounds

An out-of-state franchisee sought to escape the reach of the Massachusetts District Court in a breach of contract and trademark infringement litigation filed by its Massachusetts-based franchisor. But, the parties quickly...more

Improving Franchise Laws

Will California’s recent overhaul of its franchise relationship law lead to a proliferation of state franchise relationship laws? I doubt it. As I’ve written elsewhere, my guess is that the California law represents a...more

FRANCHISEE 101: Purposes and Limits of Non-Compete Clauses

Many franchise agreements have "non-compete clauses", which state that after termination or expiration of the franchise agreement, the ex-franchisee may not operate a business that is similar to or that would compete with the...more

Arbitration Provision Rejected in Franchise Dispute

In Case Del Caffe Vergnano SPA v. ItalFlavors, LLC, the Ninth Circuit held that the court, not an arbitration tribunal, could review a franchise contract and determine it was a sham, based upon a second contract signed...more

Michigan Franchisors Not Joint Employers of Employees of Franchisees Absent Agreement

On March 22, 2016, Michigan joined Wisconsin, Texas, Louisiana, and Tennessee by amending its Franchise Investment Law to make it clear that unless otherwise specifically provided for in the franchise agreement, a franchisee...more

CMA encourages increased competition in Britain’s rail sector

On 8 March 2016, the Competition and Markets Authority (“CMA”) published a policy document recommending that the government overhaul the currently franchised rail system. 99% of Britain’s trains presently run under...more

Franchising Update

While dispute resolution clauses may be straightforward for domestic franchise agreements as a result of the Franchising Code, dispute resolution clauses can be one of the most neglected provisions in international master...more

Ninth Circuit Refuses To Enforce Arbitration Clause In Sham Franchise Agreement

A short new opinion from the Ninth Circuit may run counter to long-standing Supreme Court precedent. In Casa Del Caffe Vergnano v. Italflavors, 2016 WL 1016779 (9th Cir. Mar. 15, 2016), the court refused to enforce an...more

Ohio Court of Appeals Upholds a Successor Manufacturer’s Termination of a Distribution Franchise

The “successorship” provision of Ohio’s franchise law for alcohol beverages has spawned much litigation over the past two decades. Premium Beverage Supply, Ltd. v. TBK Production Works, Inc. represents the latest chapter of...more

What Happens When a Franchise Agreement Ends - Part Three: Rescission

In our previous posts (See Part 1 and Part 2), we reviewed restrictive covenants and cancellation rights under franchise laws. In a recent decision of the Ontario Court of Appeal, the dispute focused on the right of...more

Real Estate Bulletin, February 2016

The Nutter Real Estate and Finance Group ended 2015 with a series of closings representing buyers, sellers, borrowers and lenders in commercial real estate transactions totaling more than $1 billion in aggregate value in...more

FRANCHISOR 101: The Importance of Arbitration Provisions

Though some of the more important terms may appear early in a franchise agreement, some key terms placed near the end - the portion of the agreement that is often called "boilerplate" - may determine who wins or loses a legal...more

FRANCHISEE 101: Relying on Franchisor’s Profit Projections

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

Rulings Pose Obstacles to Franchisors Seeking to Stop Wrongful Trademark Use

A series of recent Circuit Court decisions has made it more difficult for a franchisor to enjoin a former franchisee from using the franchisor’s federally registered trademarks after the franchise agreement has been...more

‘Twas the 2016 Franchise Renewal Season…and Labor and Regulatory matters are stirring throughout the franchise model

Last year, the franchising industry witnessed developments that significantly affected the core of its business model. These developments stem in large part from both federal and state governments taking a more active role in...more

FRANCHISEE 101: California Expands Protections for Franchisees

California Assembly Bill 525, passed into law in 2015 applies to franchise agreements entered into or renewed on or after January 1, 2016. It expands and provides new protections for franchisees. Franchisees subject to...more

Fast Facts for Franchisors: The Joint Employer Doctrine – How to Minimize Your Risk

Updating your Franchise Disclosure Document, Franchise Agreement and other system documents is more important than ever. In recent decisions, the National Labor Relations Board and the Department of Labor have increasingly...more

California’s Latest Attack on Franchise Industry Goes Into Effect

A new California law (AB 525, effective January 1, 2016) makes it harder for franchisors to terminate defaulting franchisees, requires franchisors to buyout franchisees in some cases, and adds new burdens for evaluating...more

FRANCHISOR 101: 10 Ways Franchisors Can Reduce Vicarious Liability Risks

The U.S. Department of Labor says McDonald's is liable for actions of franchisees. In the last three months a California federal court said McDonald's could be liable for a franchisee's alleged failure to pay overtime and...more

FRANCHISEE 101: Pay Attention to Contractual Statutes of Limitation

Many franchise agreements include a contractual limitation period or time limit when parties can bring a claim for relief. Though the franchise agreement is often written by and for the franchisor, these limitations can help...more

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