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Posts in Franchise Agreements.
By Dawn Johnson, Dominique de Vastey on January 30, 2018 at 12:48 PM

Signature line on a piece of paperA Georgia federal court recently found that a person who did not sign a franchise agreement was nevertheless bound by it. That was good news for a franchisor caught between two parties who claimed no responsibility for violating the franchise agreement by opening a competing business in the same franchise location. 

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By Dawn Johnson on September 11, 2017 at 11:12 AM

"Unfair" with the "un" crossed out and "fair" underlined showing unfair is now fairA recent federal appeals court decision overturning a $6.5 million jury verdict for a franchisee on a state franchise law discrimination claim demonstrates once again the difficulty that franchisees face in such challenges, even when the court finds that the franchisor treated some franchisees differently than others in some instances and could not explain why.

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By Dawn Johnson, Dominique de Vastey on September 8, 2017 at 9:40 AM

Magnifying glass showing the word "contract" on a piece of paperDespite arguably conflicting terms in a franchise agreement, a franchisor could enforce a non-compete provision whenever the agreement ended, whether by termination or expiration. An arbitrator reached that conclusion by harmonizing two provisions in the franchise agreement that referenced a non-compete obligation — one that referenced termination and one that referenced both termination and expiration. This was a reasonable interpretation of the contract, according to the Maryland federal district court that found no basis to upset the arbitration award.

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By Franchising & Distribution Group on January 11, 2016 at 10:58 AM

Leonard Vines HeadshotThe American Bar Association has recognized a program co-presented by Greensfelder Officer Leonard D. Vines as the best of last fall’s ABA Forum on Franchising.

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By Shontaia Riley on May 15, 2015 at 11:30 AM

business man jumping hurdle smallerOver the past few years, the health care industry has really taken a hit. There have been changes in the delivery of health care, reductions in payments for services and increasing regulatory burdens. These developments have forced health care entrepreneurs, investors and providers to think outside of the box and explore opportunities to open and grow franchises in a number of ambulatory care and ancillary service areas. These include home health, medical spas, physical therapy, vaccine and travel medicine centers, vision centers, direct-to-consumer laboratory testing and urgent care centers, to name a few.

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By Franchising & Distribution Group on April 30, 2014 at 9:42 AM

Baer_JR-75John Baer and his co-authors, Anders Fernlund - NOVA, Susan Grueneberg - Snell & Wilmer, LLP, and Jane LaFranchi - Marriott International, Inc., discuss the challenges a non-U.S. franchisor will face in entering the U.S. Market in the article, "Taking the Leap: Bringing a Foreign Brand to the United States," published by the International Journal of Franchising Law. Read the article.

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By Joshua Stevens on December 11, 2013 at 4:32 PM

Recently, the United States District Court for the Southern District of Indiana denied franchisor Steak n Shake’s motions to compel the non-binding arbitration of three consolidated lawsuits filed by three franchisees. The decision highlights the importance of a franchisor carefully monitoring and updating its dispute resolution policies in the context of the legal risks facing its system.

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By David Simmons on November 13, 2013 at 3:35 PM

The United States District Court for the Eastern District of Pennsylvania recently enforced a non-compete clause in a franchise agreement and granted a franchisor a preliminary injunction against its former franchisee. The court noted that Pennsylvania law recognizes that a franchisor has a legitimate business interest that can be protected by a non-compete clause, and that there was adequate consideration for the non-compete clause in that the clause was entered into as a condition of the franchise relationship. The court then analyzed if the non-compete clause was “reasonably limited in both time and territory.” The non-compete clause at issue had a duration of two years and the geographic scope of the clause was limited to ten miles from the perimeter of the franchisee’s former territory or the territory of any other franchisee.

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By Abby Risner on June 28, 2013 at 1:46 PM

DelawareBlogPostAlt2

This month, Delaware passed a law to clarify that the franchisor/franchisee relationship is not an employment relationship. The law applies to relationships that are defined as a franchise under the Federal Trade Commission franchise rule.

As we previously discussed, some states - including Delaware now - are adopting legislation to clarify that franchises are independent contractors. These laws come in the wake of cases that find franchisees to have an employment relationship.

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By Franchising & Distribution Group on March 28, 2013 at 9:47 AM

Patrick Jones and Beata Krakus recently published an article discussing how franchisor's protect themselves with franchise agreements and how these very agreements potentially are not worth the paper they are written on. Read the article to learn more about why the agreements are unenforceable and the possible scenarios for the franchisor when a franchisee files for bankruptcy.

Read the article.

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