3 Key Takeaways | Is Franchising Doomed? The 2024 Version
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Is Franchising Doomed?
Strategies for Negotiating with a Franchisee and Franchisor
Before committing to a franchise business, consider...
A federal court in New Jersey recently entered default judgment against franchisee Nisha Investments, LLC and its guarantor Rajesh Patel arising from their early termination of a franchise agreement with La Quinta...more
A federal court in Arizona recently dismissed a franchisee’s counterclaims for breach of contract, defamation, and injunctive relief against its former franchisor. LeTip World Franchise LLC v. Long Island Soc. Media Grp. LLC,...more
A federal court in California recently granted a franchisor’s motion to compel arbitration and stay the lawsuit in a dispute alleging breach of contract, breach of the implied covenant of good faith and fair dealing, and...more
From streaming services and gym memberships to software vendor agreements and e-commerce franchises, automatic contract renewals are common occurrences. Currently, California law protects consumers regarding automatic renewal...more
A New York federal court denied a franchisor’s motion to dismiss a franchisee’s complaint for misrepresentations and improper financial performance representations which allegedly induced the franchisee to enter into multiple...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
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 recent Texas Supreme Court decision fully overturned a jury’s finding that a franchisor was liable for the criminal actions of a franchisee’s employee. This decision underscores the importance of a franchisor having clearly...more
Welcome to the fifth edition of The Leisure Law Insider! Released quarterly, we cover the latest news and developments in leisure and hospitality law, regulation, and policy. Expect content on hotels, franchising, labor and...more
A hotel comfort letter is a document issued by a hotel franchisor to a lender when a hotel owner (the borrower) seeks financing. It provides the lender with assurances about the relationship between the franchisor, borrower,...more
Tariffs may seem like a headline reserved for economists and politicians, but at last week’s International Franchise Association (IFA) Legal Symposium in Washington D.C., they were front and center in nearly every room. From...more
On May 2, 2025, the Texas Supreme Court reversed a Texas Court of Appeals’ decision that had affirmed a jury’s verdict finding a franchisor directly liable to the customer of a franchisee for actions undertaken by the...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
A federal court in Ohio dismissed a putative class action brought by franchisee-eyewear sellers against their franchisor, Luxottica of America. Brave Optical, Inc. v. Luxottica of Am. Inc., 2025 WL 962827 (S.D. Ohio Mar. 31,...more
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
A federal court in New York recently denied a franchisor’s motion for summary judgment on a franchisee’s claims for fraudulent misrepresentation. Cmty. Care Companions, Inc. v. Interim Healthcare, Inc., 2025 WL 929407...more
A federal court in California recently denied a franchisor’s motion to dismiss litigation, holding that a franchise agreement provision requiring the parties to mediate in Texas prior to instituting litigation or arbitration...more
A federal court in Massachusetts recently granted, in part, a Motion for Preliminary Injunction as to enforcement of franchise agreement noncompete covenants but denied the motion as to claims of trademark infringement,...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 California federal court denied a franchisor’s motion to dismiss a franchisee’s complaint claiming the franchisee failed to first mediate the dispute before filing an action as required under the franchise agreement....more
A positive development for franchise systems seeking to streamline the SBA loan approval process for their franchisees is coming this summer. The new version of the SBA Loan Origination Policies and Procedures for Lender and...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
A federal district court in Tennessee granted a motion for a default judgment in the franchisor’s favor against its former franchisee requiring the franchisee to pay damages and comply with the post-termination obligations...more
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
An employee of a Domino’s Pizza franchisee, returning from a pizza delivery, collided with a motorcyclist who suffered serious injuries. After a Pennsylvania jury found Domino’s (as franchisor) vicariously liable for the...more