Franchises

News & Analysis as of

FRANCHISEE 101: Illusory Arbitration Provisions Not Enforceable in Indiana

In 2010, Steak 'n Shake, a franchisor of hamburger restaurants, adopted new pricing and promotion policies that required all franchisees to follow company mandated pricing on every menu item and to participate in all...more

Preparing Disclosure Documents for Renewal

A franchisor wanting to grant a franchise in any of the regulated provinces must provide a franchise disclosure document to a prospective franchisee not less than 14 days before the earlier of the signing by the prospective...more

FRANCHISOR 101: Venue and Choice of Law Provisions Not Enforceable in California

In 2013, Pepe's Franchising, a U.K. company, entered into a Master Franchise Agreement with Frango Grill, based in California, granting the right to operate and franchise Pepe's restaurants in California. The Agreement's...more

Include a Choice of Venue Clause

As franchise systems expand into multiple jurisdictions, the choice of venue and choice of law clauses are critical to avoiding litigation delays. In a country like Canada, where the regulation of franchises varies between...more

Québec Franchisor Compensated for Breaches of Franchise Agreements

On April 25, 2014, the Québec Court of Appeal rendered its decision in Les billards Dooly’s inc. c. Les entreprises Prébour ltée, 2014 QCCA 842. The franchisor, Les billards Dooly’s inc. (Dooly’s) brought the underlying...more

Joint employer law: is the NLRB edging closer to the abyss? Takeaways from the Bloomberg webinar

Last week, Bloomberg BNA presented a webinar titled “The Current State of Joint Employer Law: How Can Both Employers and Unions prepare for the Future?” The three presenters were Barry Kearney, National Labor Relations...more

A Cautionary Tale on Arbitration Clauses

In July 2014, the Ontario Superior Court of Justice released its decision in 2296432 Ontario Ltd v. FOF Franchise Corp. The case involved an action by plaintiff franchisees for rescission of a franchise agreement and related...more

Top of Mind - October 2014: Editor's Choice

BYOD: cool but dangerous – 3 HIPAA Security Rule challenges, 7 key precautions - Companies and employees like the idea of bring your own device (BYOD) policies that allow employees to use their personal mobiles for...more

Why Subfranchising is Rare in the U.S.

Subfranchising is one of three multi-unit franchise structures that the North American Securities Administrators Association, Inc. (NASAA) addressed in their Multi-Unit Commentary, which was the subject of an earlier post. ...more

Franchise Legislation October 2014: The Latest Word on Franchise Legislation in British Columbia

British Columbia continues along the path towards franchise legislation, albeit at a glacial pace. In late March, the British Columbia Law Institute (BCLI), a law reform research organization, published its Report on a...more

Businesses Anxiously Await NLRB Decision on Joint Employer Standard

Many are up in arms following a memorandum issued by the General Counsel of the National Labor Relations Board (NLRB) authorizing employees of a national restaurant chain to argue that the franchisor is jointly responsible...more

California’s Governor Brown Does the Right Thing

The big news in franchising last week was a nonevent. Legislation in California that never should have become law did not become law. The credit for this nondevelopment goes to Governor Jerry Brown, who vetoed Senate Bill...more

Franchisors Are Not Joint Employers

The National Labor Relations Board (NLRB) caused an earthquake in the field of franchising with the General Counsel’s announcement July 29, 2014, of complaints against McDonald’s USA, LLC....more

How to Disclose Multi-Unit Franchise Offerings

Multi-unit franchising is a good way to grow a franchise system quickly. We now have guidance on how franchisors should present multi-unit franchise offerings....more

EEOC Ramps Up Attack On Mandatory Arbitration Agreements

Over the course of its history, the U.S. Equal Employment Opportunity Commission (“EEOC”) has disfavored the application of mandatory arbitration agreements within the employment context. Indeed, until the decision in...more

Is Franchising The Right Model For Your Business?

Franchising is a flexible, tried and true method of distributing products and services and offers business owners an alternative avenue to expand their already successful businesses. One immediately thinks of McDonalds or...more

Fifth Circuit Allows Title VII Suit Against Franchisor to Proceed Even Though It Was Not Named in EEOC Charge

In order to sue under Title VII, plaintiffs must first file an administrative charge of discrimination against their employer with the Equal Employment Opportunity Commission. In many cases, the charge misnames the actual...more

Governor Vetoes Proposed Changes to California Franchise Law

To the surprise of many, California Governor Jerry Brown has vetoed the proposed changes to California’s franchise laws that were discussed in our Client Alert on August 28, 2014. In his veto message, Governor Brown...more

Oklahoma Chicken Express Franchiser to Pay $15,000 to Settle EEOC National Origin Discrimination Suit

Restaurants Exploited Class of Hispanic Cooks by Failing to Pay Overtime, Federal Agency Charged - OKLAHOMA CITY, Okla. - NSC Chicken, LP, dba Chicken Express, will pay $15,000 and furnish other relief to settle a...more

Brand Protection: The Case for Franchisor Auditing and Enforcement of Franchise Agreement Compliance Clauses

The recent criminal prosecution of several 7-Eleven franchisees, which arose out of a criminal alien employment investigation, as well as efforts by government agencies to treat franchisors and franchisees as joint employers...more

Georgia Court of Appeals rules franchisees can assert claims for relief under Georgia’s tort statute for violating the FTC...

The Georgia Court of Appeals recently upheld a judgment entered on a jury verdict against a franchisor for violating the Federal Trade Commission’s Franchise Rule, 16 CFR Parts 436 and 437 (the FTC Rule), finding that the FTC...more

Five Tips To Launching A Franchise Program Successfully

CONGRATULATIONS! You’ve spent years building your business, developing a loyal following, and honing your operations into a replicable format. You own two, three or maybe ten different locations, all profitable, and...more

Domino’s Delivers Key Ruling in Favor of Franchisors

The California Supreme Court recently issued an important victory for franchisors, finding that a franchisor does not stand in an employment or agency relationship with the franchisee and its employees for purposes of holding...more

Employment Flash - September 2014

In This Issue: - SEC Pays First Whistleblower Award to Audit and Compliance Professional - Supreme Court Allows Affordable Care Act Contraceptives Religious Exemption - EEOC Adopts New Pregnancy...more

Joint Employers Under NLRB Law

A. Introduction - Over the last few weeks, there has been a great deal of discussion in the legal media regarding the National Labor Relations Board (NLRB or Board) General Counsel’s (GC) argument to the Board, that...more

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