3 Key Takeaways | Is Franchising Doomed? The 2024 Version
Is Franchising Doomed?
II-27 - Our 1st Anniversary Special: Bringing Back Our Inaugural Guest to Discuss What Was and What Will Still Be With President Trump
Employment Law This Week: Break Pay, Misclassification of Franchisees, California Computer Professional Exemption, Non-Compete Payment
An Ohio federal court granted a franchisor’s motion to dismiss a putative class of franchisees alleging antitrust violations and related claims, including interference to deflate franchisees’ reimbursement rates. Other class...more
A Massachusetts federal court granted a franchisor’s request to enforce the franchise agreement’s post-termination non-compete provision against a terminated franchisee....more
A recent federal court decision in T&T Management, Inc. v. Choice Hotels, Inc. underscores key contractual and operational considerations for franchisors. T&T filed suit in U.S. District Court for the District of Minnesota...more
On February 27, 2025, the District of Minnesota granted a franchisor’s motion to dismiss a lawsuit initiated by its franchisee, alleging, among other things, breach of contract and misappropriation of trade secrets under the...more
A federal court in Arizona recently granted a franchisee’s motion for temporary restraining order preventing termination of its franchise agreement and the franchisor’s withdrawal of any funds from the franchisee’s accounts....more
The International Franchise Association’s Annual Convention is always filled with useful take home information for franchise practitioners. Last week, I attended the session “Proactive Strategies for Franchisors to Prevent...more
Deciding whether to choose state or federal court can be outcome determinative. This is particularly important in deciding to remove a case from state to federal court. Some state franchise statutes clearly allow a court to...more
A federal court in Ohio recently narrowed two hotel franchisors’ attempt to implead their franchisee in a lawsuit under the Trafficking Victims Protection Reauthorization Act (TVPRA). A.S. v. Red Roof Inns, Inc., 2024 WL...more
In a franchisor’s suit against its franchisee and that franchisee’s new business, a federal court in Kansas recently denied the new business’ motion to dismiss for lack of personal jurisdiction. HappyFeet-Legends Int’l, Inc....more
A Minnesota district court issued a preliminary injunction against a former franchisee who engaged in a competing business during the franchise relationship. Snap Fitness, Inc., a gym franchisor, entered into a franchise...more
A federal court in Minnesota recently granted franchisor Snap Fitness Inc.’s motion for preliminary injunction against an out-of-state franchisee that announced its intentions to open a competing gym during the term of the...more
A federal court in Florida recently held that extending a consent injunction was necessary to protect the interests of a franchisor. Tri-Cnty. Mobile Wash, Inc. v. B&C Wash Corp., 2024 WL 4379673 (S.D. Fla. Oct. 3, 2024)....more
The Tennessee Court of Appeals reversed a district court’s dismissal of a franchisee’s declaratory judgment claim, finding that the claim was properly brought in Tennessee. Lakeway Real Estate2, LLC v. ERA Franchise Sys.,...more
A Kansas district court denied a franchisor’s motion for preliminary injunction against its former franchisee who engaged in competing businesses immediately after terminating the franchise relationship....more
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
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
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
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
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
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
A recent court decision explained the circumstances under which a plaintiff may assert a claim for promissory estoppel and whether a private right of action exists for a certain alleged violation of the Michigan Franchise...more
A federal district court in Texas denied an individual defendant’s motion to dismiss for lack of personal jurisdiction, finding the defendant—the owner of the company that was granted a franchise—was bound in his individual...more
A federal district court in Texas denied a preliminary injunction filed by a franchisee (“EYM”) after Pizza Hut, as franchisor, terminated the franchise agreements....more
A federal court in Illinois recently denied cross motions for partial summary judgment as to franchisor 360 Painting, LLC’s claims for breach of contract by painting franchisee R. Sterling Enterprises, Inc. (RSE), and breach...more
A federal court in Colorado denied WD Ventures, LLC’s motion to dismiss for forum non conveniens pursuant to the forum selection clause in the parties’ franchise agreement indicating that the parties contemplated federal...more