Our Franchise Practice represents franchisors and franchisees on an array of matters. We have experience in state and federal franchise laws and regulations and are well equipped to assist clients in franchise disputes. We track applicable case law, regulations and statutes for changes in franchise-related laws and regulations on the state and federal levels. Our experience includes:
- Assisting clients in registering trademarks and other proprietary intellectual property;
- Drafting and reviewing franchise-related documents such as Franchise Disclosure Documents (“FDDs”), Franchise and License Agreements, and Area Development Agreements;
- Forming limited liability companies and corporations; and
- Negotiating with franchisors or franchisees with regard to termination agreements, non-compete agreements, and buyback/sellback agreements.
We advise clients in litigation and alternative dispute resolution on:
- Breach of contract matters such as failure to abide by brand and industry standards;
- Employment matters;
- Enforcement of non-compete agreements;
- Fraud claims;
- Infringement and protection of intellectual property rights;
- Non-payment of royalties; and
- Termination issues.
While Franchise Law is a specialty in its own right, we take a multi-disciplinary approach often relying on and engaging with colleagues in other practice areas such as contracts, litigation, alternative dispute resolution, intellectual property, fraud and misrepresentation and labor and employment.
Regulatory Compliance and Counseling
Franchise Law is closely regulated on the state and federal level and we understand our clients have to be cognizant of not only these two bodies of regulation but also their interplay. Many states regulate pre-sale disclosure and registration. Some of the laws have requirements that are different from the Federal Trade Commission (FTC) Franchise Rule. In addition, many states have passed laws that are designed to protect franchisees from what is thought to be their compromised bargaining position as compared to franchisors. These laws restrict franchisors’ rights in several ways such as with regard to termination rights, transfers of franchises, preferential treatment of franchisees over others and limitations that disputes be resolved out of the franchisee’s home jurisdiction, among others. Our franchise attorneys know our clients ‘ businesses and the industries in which they operate and assist franchisors' clients with compliance, negotiation and enforcement of agreements as well as franchisee renewals, terminations and transfers and pricing matters.
Franchise agreements are typically long-term relationships. It is not unusual for franchisors and franchisees to have disputes that result in mediation, arbitration, and litigation. These disputes often stem from franchisees who are unprofitable or less profitable than expected, or franchisees may disagree with decisions made by the franchisor. Disputes also may result when a franchisor is unhappy with the way in which a franchisee is operating the franchise or when a franchisee refuses to pay royalties. Franchise disputes frequently involve allegations such as:
- Breach of contract
- Fraud and misrepresentation
- Non-compete agreements
- Overcharging and pricing issues
- Termination and non-renewals
- Transfer matters
- Violation of brand and governing standards
- Vicarious liability
Keith A. Krauss
Rajiv D. Parikh
Charles J. Messina
Kathleen Barnett Einhorn