On May 2, 2025, the Texas Supreme Court held that a franchisor owes no duty of care for injuries caused by a franchisee’s employee unless the franchisor retained or exercised control over the hiring of that employee....more
A federal court recently granted in part and denied in part a franchisor’s motion to enjoin the post-termination activities of its former franchisees and two related entities. Rooterman, LLC is a plumbing services franchisor....more
6/23/2025
/ Business Litigation ,
Confidential Information ,
Enforcement Actions ,
Franchise Agreements ,
Franchises ,
Intellectual Property Litigation ,
Non-Compete Agreements ,
Non-Solicitation Agreements ,
Preliminary Injunctions ,
Restrictive Covenants ,
Trademark Infringement
A federal court recently enjoined a franchisor from terminating a franchise agreement or interfering with a franchisee’s operations pending the resolution of the franchisor’s motion to transfer venue....more
Dispute resolution provisions in franchise agreements often address how, when, and where parties will mediate. However, the enforceability of these provisions can change depending on the law of the state governing the...more
The Eighth Circuit recently applied a novel, broad reading of the Missouri Franchise Act granting franchise protection to distributors which previously would not likely have been considered franchisees....more
Effective June 1, 2025, the U.S. Small Business Administration (SBA) will reinstate its Franchise Directory, a critical development for franchise systems and franchisees seeking SBA financing. Originally launched in 2018 and...more
5/7/2025
/ Financial Institutions ,
Franchise Agreements ,
Franchises ,
Government Agencies ,
International Franchise Association (IFA) ,
Lenders ,
Loans ,
New Regulations ,
Regulatory Reform ,
SBA ,
SBA Lending Programs ,
Small Business
In OTG New York, Inc. v. Ottogi America, Inc., OTG was the exclusive regional distributor for food company Ottogi from 2008–23, during which Ottogi shipped inventory to OTG’s New Jersey warehouse. In 2024, Ottogi terminated...more
Decozen Chrysler Jeep Corp. (“Decozen”), a New Jersey-based automobile dealership, filed a lawsuit against Fiat Chrysler Automobiles, LLC (“FCA”), in U.S. District Court for the District of New Jersey alleging that FCA...more
4/11/2025
/ Antitrust Violations ,
Automotive Industry ,
Breach of Contract ,
Contract Disputes ,
Dealerships ,
False Claims Act (FCA) ,
Franchise Agreements ,
Franchise Laws ,
Fraud ,
Manufacturers ,
Misrepresentation ,
Motion to Dismiss ,
Unfair Competition
A key term of any franchise agreement is the venue selection clause as this page has previously explained.
This issue was at the forefront of Convenience Stores Leasing & Management, LLC’s (“CSLM”) August 2024 suit...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
3/27/2025
/ Acquisitions ,
Breach of Contract ,
Contract Terms ,
Due Diligence ,
Franchise Agreements ,
Franchisee ,
Franchisors ,
Litigation Strategies ,
Misappropriation ,
Motion to Dismiss ,
Tortious Interference ,
Trade Secrets
A recent New Jersey appellate court decision provides valuable guidance for franchisors and their in-house legal teams on structuring and protecting franchise relationships. The court affirmed that a terminated retailer of...more
In May of last year, the Federal Trade Commission (FTC) sought to ban non-compete agreements in most employment contracts. Franchise agreements were an exception. However, before the rule could take effect in September, a...more
2/18/2025
/ Antitrust Provisions ,
Compliance ,
Contract Terms ,
Federal Trade Commission (FTC) ,
Franchise Agreements ,
Franchises ,
Franchisors ,
NASAA ,
Non-Compete Agreements ,
Restrictive Covenants ,
Trade Secrets
A Washington state appeals court has clarified the scope of Washington’s Franchise Act in Lucid Group USA, Inc. v. State of Washington, Department of Licensing. There, Lucid Group USA, Inc. (“Lucid Group”), the dealer, wanted...more
Washington-state based franchisees Greg and Gabriela Skistimas brought suit against Hotworx Franchising LLC in the U.S. District Court for the Western District of Washington alleging misleading and unfair practices related to...more
12/3/2024
/ Arbitration ,
Disclosure Requirements ,
Federal Trade Commission (FTC) ,
Franchise Agreements ,
Franchises ,
Franchisors ,
FTC Franchise Rule ,
Louisiana ,
Marketing ,
Misleading Statements ,
Motion to Compel ,
Personal Jurisdiction ,
Unfair or Deceptive Trade Practices ,
Washington
The Superior Court of Connecticut addressed a contractual dispute between a manufacturer of snow removal equipment and its distributor. HP Fairfield, a distributor of snow removal equipment, argued that a manufacturer, CIVES...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 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
9/11/2024
/ Advertising ,
Breach of Contract ,
Declaratory Judgments ,
Enforcement ,
Fees ,
Franchise Agreements ,
Franchisee ,
Franchises ,
Investment ,
Popular ,
Promissory Estoppel ,
Royalties
On July 12, 2024, the Federal Trade Commission (FTC) issued a policy statement regarding franchisors’ use of contract provisions such as non-disparagement, goodwill, and confidentiality clauses. This is another example of the...more
Franchise agreements’ arbitration clauses are enforceable even when subsequent agreements between the same parties contain forum selection clauses requiring litigation in different forums. Additionally, a trial court’s...more
The U.S. District Court for the District of New Jersey refused a franchisee’s attempt to broaden the protections of the New Jersey Franchise Protection Act. William Minnebo and Philly Metal Supply LLC entered into a franchise...more
Lyvette Mercado Velez, a dietitian, entered into a distribution agreement with Insulet Corporation, a leading medical device manufacturer, to promote and sell diabetes treatment products and services in Puerto Rico. Shortly...more
In Alamo Intermediate II Holdings, LLC. v. Birmingham Alamo Movies, the U.S. District Court for the Western District of Texas, denied franchise owner Hunter Renfroe’s motion to dismiss for lack of personal jurisdiction. The...more
In Bank United, NA v. GC of Vineland, LLC, Karen and William Scism and GC Vineland, LLC (“GVC”) (collectively the “Scism Parties”) filed a complaint in the U.S. District Court for the District of New Jersey against Golden...more
In LeTip World Franchise LLC v. Long Island Social Media Group LLC, the U.S. District of Court for the District of Arizona granted a temporary restraining order in favor of a franchisor, LeTip World Franchise LLC (“LeTip”)...more
In Louis Degidio, Inc. v. Industrial Combustion, LLC, Louis Degidio, Inc. (Degidio) and Louis Degidio Services, Inc. (Degidio Services) sued Industrial Combustion, LLC (IC), a manufacturer of “institutional boiler system”...more