News & Analysis as of

Franchisee

The UK Criminal Finances Act 2017: tax evasion implications for franchisors – action steps

by DLA Piper on

The Criminal Finances Act 2017, now in force in the United Kingdom, introduces two new criminal offenses in respect of the facilitation of tax evasion. The new offenses will be committed where a corporate entity or...more

Congressional Bill: Joint Employer Liability May Become More Limited

by Jackson Lewis P.C. on

The EPL industry rightfully has been concerned about the NLRB’s and courts’ expansion of liability from the seeming employer to those with relationships to that entity. Franchisors increasingly were exposed to liability for...more

FRANCHISEE 101: Thirty-one Flavors of Fees (Or Just One)

by Lewitt Hackman on

Baskin-Robbins charges a dairy supplier a so-called "commercial factor" fee for the right to make and sell Baskin-Robbins proprietary ice cream to franchisees. The supplier's pricing to franchisees includes an amount equal to...more

FRANCHISOR 101: Arbitr-“all”

by Lewitt Hackman on

A federal court in New Jersey granted a franchisor's motion to compel arbitration of disputes involving seven frozen yogurt franchises, even though the claims were subject to different arbitration provisions in different...more

Cybersecurity: New Front for Attacks on Franchise Model

by Dorsey & Whitney LLP on

Much has been written on the growing risks of data breaches and other cyberattacks, especially after the massive security breach at Equifax in September 2017. Recent cases holding franchisors liable for franchisees’ data...more

FRANCHISOR 101: A Clean Sweep

by Lewitt Hackman on

A federal court recently held that under California law, cleaning services franchisor Jan-Pro Franchising International (Jan-Pro) was not the employer of its unit franchisees. The franchisee plaintiffs failed to show that...more

Federal Court Concludes Franchisor Was NOT Joint Employer

by Fox Rothschild LLP on

Another case has been decided adding to the back and forth in the legal world on the issues of a joint employer relationship of a franchisor and its franchisee and vicarious liability and agency between a franchisor and...more

FRANCHISEE 101: Upgrade Your Metal

by Lewitt Hackman on

A federal court in New York denied a franchisee's motion for preliminary injunction that would have prevented its franchisor Metal Supermarkets Franchising America (MSFA) from installing technology upgrades in its stores....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

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

Navigating The Private Right Of Action Under The California Franchise Investment Law

by Mulcahy LLP on

The California Franchise Investment Law (“CFIL”) regulates both the sale and disclosure of franchise opportunities within the state. The law was enacted to “provide each prospective franchisee with the information necessary...more

FRANCHISOR 101: Manual Overload

by Lewitt Hackman on

A franchisor's investment in brand standards, protection and control often comes at a cost when a consumer believing or claiming to believe the franchisor and franchisee are the same, seeks to hold a franchisor liable for a...more

FRANCHISEE 101: Cold Brew Remedy

by Lewitt Hackman on

Beer distributors can be on common footing with their franchisee counterparts in bargaining with brewers or suppliers. Depending on the jurisdiction, distributors may have protection through beer distribution statutes...more

FRANCHISEE 101: McDonald's Shaking Damages for OT Policy

by Lewitt Hackman on

In Los Angeles Superior Court, McDonald's claimed victory when 6,600 workers seeking $41 million in back pay and penalties came away with less than 2% of the amount sought in a claim that the fast-food giant cheated them out...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

Franchisor Not Liable For Franchisee’s Tip Policy That Allegedly Violated Massachusetts Law

The Massachusetts Superior Court has recently issued a favorable opinion to franchisors under the Massachusetts Tips Act. In Yarpah v. Bowden Hospitality Newton, LLC d/b/a Crowne Plaza Hotel, Justice Kenneth W. Salinger held...more

Jan-Pro International Is Not The “Employer” Of Its Franchisees And Did Not Commit Wrongdoing, Court Finds

On May 24, a federal judge in California polished off a three-state win by master franchisor, Jan-Pro Franchising International, Inc., finding that under California law, unit franchisees (subfranchisees) who had franchise...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

When are Parent Company Financial Disclosures Required?

by LeClairRyan on

A franchisor selling franchises in the U.S. must disclose its audited financial statements in Item 21 of the franchise disclosure document (FDD). Sometimes, parent company financials are used instead of the franchisor’s...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

FRANCHISEE 101: Special Delivery

by Lewitt Hackman on

For a relationship to meet the legal definition of a "franchise" in some jurisdictions, the franchisor must give significant assistance to, or have significant control over, the franchisee's business. A franchisor's...more

Tesla “Franchisee” Thwarted in Utah

by Fox Rothschild LLP on

Tesla, the electric vehicle automaker, recently lost a round in the Supreme Court of Utah. Tesla set up a wholly-owned subsidiary called “Tesla UT” that was to hold a license to sell Tesla’s cars to the public. The Utah...more

NLRB Ruling on Joint Employers Should be Reversed, Congressional Republicans Urge

by Jackson Lewis P.C. on

Two years after the National Labor Relations Board’s decision in Browning-Ferris Industries of California, Inc., 362 NLRB No. 186 (2015), which overturned 30 years of precedent, 57 members of Congress, mostly Republicans,...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

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