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Lathrop GPM

Minnesota Supreme Court Holds that Franchisees Based Outside of Minnesota Are Not Barred from Asserting Claims Under the Minnesota...

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The Supreme Court of Minnesota has held that there is no territorial limit to the Minnesota Franchise Act’s (MFA) provision barring unfair practices, but nevertheless affirmed dismissal of MFA claims where the parties’...more

Lathrop GPM

Franchisee’s Execution of Competing Franchise Agreement During Franchise Term Forecloses Claims Against Former Franchisor

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A federal court in New Jersey granted the franchisor of the Holiday Inn and Holiday Inn Express brands (Holiday Hospitality) summary judgment on former franchisee Scion Hotels’ complaint alleging violations of the New Jersey...more

Lathrop GPM

Massachusetts Supreme Judicial Court Rules that Franchisees Did Not Perform Services for Franchisor Within the Meaning of the...

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The Massachusetts Supreme Judicial Court answered “no” to a certified question from the First Circuit Court of Appeals asking whether plaintiff franchisees “‘perform any service’ for 7-Eleven within the meaning of [the...more

Freeman Law

Is Your Business Subject to the Texas Franchise Tax?

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As noted in a prior post, the Texas franchise tax is a tax imposed on any “taxable entity” that does business in Texas or that is chartered or organized in Texas. This begs the question – “Which entities are taxable, and...more

IR Global

How To Ensure A Smooth Transaction When Selling A Franchise

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Mergers and acquisitions (M&A) in the franchise industry are complex transactions that require careful planning, due diligence, and a keen understanding of both pre and post-deal considerations. With extensive...more

Locke Lord LLP

Can Nurses Lawfully Be Classified as Independent Contractors? September 2024 IC Legal ‎News Update

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One of the most important legal developments last month is a new lawsuit filed by registered nurses against a leading health care system alleging that they have been misclassified as independent contractors instead of...more

Pillsbury - SeeSalt Blog

California’s Market-Based Sourcing Amendments; Public Hearing Requests Due by Oct. 16

The California Franchise Tax Board (FTB) announced it has initiated the formal rulemaking process to amend Regulation Section 25136-2, which governs the sourcing of receipts from services and intangible property.  The...more

Falcon Rappaport & Berkman LLP

Michigan Bankruptcy Court Holds That a Non-Compete Clause Survives the Rejection of an Executory Contract and That a...

In a recent decision of interest, the Bankruptcy Court for the Eastern District of Michigan held that a non-compete clause within a franchise agreement as well as confidentiality agreement could not be rejected as an...more

Epstein Becker & Green

Massachusetts High Court Rules That Franchisees Are Independent Contractors

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In a win for businesses, the Massachusetts Supreme Judicial Court (“SJC”) has ruled that individuals in true franchisor-franchisee relationships are independent contractors....more

Lewitt Hackman

Franchisee 101: No Spice; No Injunction

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A Colorado federal court denied a franchisor’s request for preliminary injunction that would enforce a non-compete provision against a former franchisee. The franchisor of spice and tea shops known as Spice & Tea Merchants...more

Lewitt Hackman

Franchisor 101: Non-Performance – Fact or Fiction?

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A New Jersey federal court granted in part a hotel franchisor’s motion for summary judgment against its franchisee and the guarantor of the personal guaranty, for breach of the parties’ franchise agreement. The franchisee did...more

Fisher Phillips

7-Eleven Franchisees Are Not Employees Under Massachusetts Law: 5 Tips to Ensure Compliance After Latest Ruling

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The Massachusetts Supreme Judicial Court (SJC) just delivered a win for franchisor-franchisee relationships. Specifically, the court held that 7-Eleven franchisees are not performing a “service” for their franchisor, meaning...more

Constangy, Brooks, Smith & Prophete, LLP

Oh, thank heaven! 7-Eleven franchisees were not misclassified “employees,” MA high court rules

The Supreme Judicial Court of Massachusetts, answering a certified question, has ruled that five 7-Eleven franchisees were independent contractors, not misclassified “employees,” under the Massachusetts Independent Contractor...more

Akerman LLP

Leisure Law Insider (Vol. 4) - Fall 2024

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Welcome to the fourth edition of The Leisure Law Insider! Released quarterly, we cover the latest news and developments in leisure and hospitality law, regulation, and policy. Expect content on hotels, franchising, labor and...more

Seyfarth Shaw LLP

The Massachusetts Supreme Judicial Court Upholds 7-Eleven Franchise System in Denying Franchisees’ Challenge to Their Independent...

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On September 5, 2024, the Massachusetts Supreme Judicial Court (“SJC”) answered a second certified question in Patel, et al. v. 7-Eleven, Inc., et al. (“Patel II”), a long-running case where 7-Eleven franchisees claimed they...more

Foley & Lardner LLP

Franchisor Enforces Its Trademark Rights Against Former Prospective Franchisee

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A franchisor may pursue claims for declaratory and injunctive relief for potential trademark infringement against a former prospective franchisee even though the prospect never actually used the marks in question. Grainier...more

Proskauer - Tax Talks

California FTB Releases Updated Proposed Regulations on Market-Based Sourcing Rules – Implications for Asset Managers

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On September 13, 2024, California’s Franchise Tax Board (“FTB”) released updated proposed regulations (“Draft Regulations”), which would amend the rules regarding market-based sourcing for sales other than sales of tangible...more

Faegre Drinker Biddle & Reath LLP

Minnesota Supreme Court Holds the Minnesota Franchise Act Does Not “Categorically Preclude” Enforcement by Out-of-State...

On September 11, 2024, the Minnesota Supreme Court issued an opinion holding that the Minnesota Franchise Act (MFA) does not “categorically preclude an out-of-state company from enforcing a claim for unfair practices” under...more

Foley & Lardner LLP

Manufacturer Acted Reasonably in Terminating a Franchisee for Failure to Abide by Agreement

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Tasty Baking Company (“Tasty”), a manufacturer of prepackaged goods, terminated Distefano, Inc. (“Distefano”), Maryland-based owner of a franchise with rights to sell Tasty products in a prescribed area called a “route.”...more

Foley Hoag LLP

Massachusetts Supreme Judicial Court Rules 7-Eleven Franchisees Are Not Employees

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On September 5, 2024, the Massachusetts Supreme Judicial Court (“SJC”) ruled in Patel v. 7-Eleven that 7-Eleven franchisees are not employees of the franchisor under the independent contractor statute. The SJC looked beyond...more

Lathrop GPM

Ohio Appellate Court Reverses Summary Judgment Holding Regarding Applicability of Area Representative Agreement to Individuals

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An Ohio appellate court, reversing a summary judgment decision, recently held that the “full-time efforts” section of an Area Representative Agreement was applicable only to the area representative entity and not the...more

Lathrop GPM

Michigan Federal Court Grants Franchisor’s Motion for Preliminary Injunction Against Former Restoration Service Franchisee

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A federal court in Michigan has granted a franchisor’s motion for preliminary injunction against former franchisees for violating the franchise agreements’ post-termination noncompete provisions. 1-800 Water Damage Int’l LLC...more

Lathrop GPM

Michigan Precedent on Michigan Franchise Investment Law Held to Trump Inconsistent Sixth Circuit Precedent on Private Right of...

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A federal court in Michigan recently granted several related franchisors’ motions to dismiss a franchisee’s claims for violations of the Michigan Franchise Investment law. Benjamin Franklin Franchising SPE LLC v. David...more

Lathrop GPM

Appellate Court in Pennsylvania Affirms Ruling on Gas Station Franchisor’s Indemnification Claims

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A state appellate court in Pennsylvania recently affirmed a trial court’s summary judgment ruling addressing a franchisor’s claims for indemnification in a personal injury dispute. Sunoco (R&M), LLC v. Pa. Nat'l Mut. Cas....more

Lathrop GPM

Virginia Federal Court Rules It has Subject Matter Jurisdiction Over DTSA Claim Because Foreign Bankruptcy Proceeding Only Stayed...

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A federal court in Virginia recently ruled that it had federal question subject matter jurisdiction over a Defend Trade Secrets Act (DTSA) claim, rejecting Defendants’ argument that a foreign bankruptcy proceeding stayed the...more

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