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Fraud Franchisee

Fraud is the making of false representations or engaging in deceptive behavior in order to unlawfully secure financial or personal gain. 
Lathrop GPM

Eleventh Circuit Holds Franchisor’s Justified Threat of Criminal Prosecution Does Not Justify Setting Aside Settlement Agreement...

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The Eleventh Circuit Court of Appeals recently upheld a settlement agreement between a franchisor and former franchisee that the franchisee alleged was obtained under the threat of criminal prosecution. Sewalk v. Valpak...more

Lathrop GPM

Illinois Federal Court Grants Franchisor’s Motion to Dismiss Terminated Franchisee’s Fraudulent Misrepresentation and Breach of...

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A federal court in Illinois recently dismissed a former franchisee’s counterclaims for alleged fraudulent misrepresentation, breach of contract regarding the franchisor’s advertising fund, and breach of contract and implied...more

Lathrop GPM

Fifth Circuit Affirms Enforcement of Jury Trial Waiver in Franchise Transfer Agreement

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The Fifth Circuit Court of Appeals recently affirmed the enforcement of a jury trial waiver against a franchisee. Pizza Hut L.L.C. v. Pandya, 79 F.4th 535 (5th Cir. Aug. 22, 2023). Pizza Hut originally filed suit against...more

Lathrop GPM

North Carolina Federal Court Rules That Franchise Agreement’s 1-Year Statute of Limitations Clause Barred Action Against...

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A federal court in North Carolina recently dismissed a complaint brought by Bigelow Corporation against its franchisor Hound Town USA because the claims were time barred. Bigelow Corporation v. Hounds Town USA, LLC, 2023 WL...more

Lathrop GPM

The Franchise Memorandum - Issue #269

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Two Illinois Federal Courts Deny Class Certification in Anti-Poaching Class Actions Against Franchisors - Two federal courts in Illinois have rejected motions to certify classes of employees who worked in franchised...more

Lathrop GPM

The Franchise Memorandum - Issue # 268 (Distribution Issue)

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Welcome to The Franchise Memorandum by Lathrop GPM. Periodically, The Franchise Memorandum focuses on topics primarily of interest to companies that use distributors and dealers rather than manage a business format franchise...more

Lathrop GPM

The Franchise Memorandum - Issue # 265

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Welcome to The Franchise Memorandum by Lathrop GPM. Below are summaries of recent legal developments of interest to franchisors. Fraud/Misrepresentation - Minnesota Federal Court Rules that Fraud and Misrepresentation...more

Lathrop GPM

The Franchise Memorandum - Issue # 261

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Welcome to The Franchise Memorandum by Lathrop GPM. Below are summaries of recent legal developments of interest to franchisors. Fifth Circuit Reverses Trial Court’s Excusal of Area Representative’s Tardy Renewal Notice -...more

Lathrop GPM

The Franchise Memorandum - Issue # 257

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Welcome to The Franchise Memorandum by Lathrop GPM, formerly known as The GPMemorandum. Below are summaries of recent legal developments of interest to franchisors. Given the widespread and evolving impact of the COVID-19...more

Lewitt Hackman

Franchisee 101: Expo is No Excuse

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A federal court in Missouri ruled that a franchisee’s fraud claim cannot be based on the franchisor’s prediction at a franchise expo of future success in the franchised business....more

Lewitt Hackman

FRANCHISEE 101: Bar-B-Q Blues — A Tale of Friendship, Partnership, and Deceit

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A federal appeals court reversed dismissal of a claim against a barbeque restaurant franchisor. The court found that, despite having signed releases in favor of the franchisor, a former franchisee had valid claims for...more

Lewitt Hackman

Franchisor 101: The Proof Is in the Writing

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Ten years after the franchisor of the EXIT real estate system entered into a franchise agreement for a franchisee to operate an EXIT franchise in Maitland, Florida, the parties entered into another franchise agreement for a...more

Lewitt Hackman

Franchisee 101: Precluding the Competition

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A commercial real estate relocation and consulting business franchisor (Relo) succeeded in getting a preliminary injunction to enforce a non-compete covenant against a former franchisee....more

Lewitt Hackman

Franchisor 101: Hot Doggin' Franchisee Sales Pitches

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Hot dog franchisor, Charlie Graingers, was unable to obtain dismissal of a federal lawsuit brought by franchisees alleging fraud, misrepresentation and breach of fiduciary duty....more

Lewitt Hackman

FRANCHISOR 101: Liability as Certain as Death & Taxes

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Structuring a franchise to reduce risk of joint employment and vicarious liability means limiting a franchisor's control over franchisees. This is a challenge in a professional services franchise, where the brand is...more

Lewitt Hackman

FRANCHISEE 101: Understanding Merger/Integration Clauses

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Before a final agreement is signed there are often oral discussions, negotiations, and representations. There may be written memorandums of understanding or letters of intent. But, when the final agreement has a "merger" or...more

Lewitt Hackman

FRANCHISEE 101: Relying on Franchisor’s Profit Projections

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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

Baker Donelson

California Dreams Becoming Reality for Franchisees; Amended Franchise Relationship Law Nears Passage

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The California State Assembly saw the seventh amended version of proposed changes to the California Franchise Relationship Act (CFRA) introduced August 17, 2015. This amendment is the product of industry negotiations that...more

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