Driving into the office this morning I got a call from a franchisee in North Carolina. He was looking to hire an associate, who signed a non-compete with another competitor. Someone told the franchisee that non-competes can only be enforceable for one
A Post from the Field: Franchisor Audit Programs, Cautions and Best Practices.
Uncle Sam audits tax payers, but how about Franchisors auditing franchisees? Most franchise agreements grant the franchisor the right to audit a franchisee, but franchisor auditing practices can go awry because of franchise laws and implied obligations of good faith
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The Expanses of the Court in Internet Transactions Just Got Larger.
It used to be that if someone in Nebraska used your trademark on the Internet, you had to go to Nebraska courts for relief. It used to be that if you sold a product on the internet, you could only
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A Post from the Field: It’s Time to Update Your SBA Registration!
Just like Franchise Disclosure Documents (FDD) and state registrations, a franchise’s SBA registration must be updated annually. The update process includes submission of current disclosure documents, agreements and completion of an online questionnaire. The initial SBA registration is $2,500 currently,
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Lessons from the Court Room: A Case of Racial Discrimination, or Not?
Is it possible for a franchisor to be held liable for racial discrimination against a franchisee’s shareholders? In a case out of the 4th Circuit, the Court said NO. The case was Beasley v. Arcapita, Inc. Beasley, an African-American franchisee
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Lessons from the Court Room: You Don’t Have to Tell How Much It Made
Business locations owned and operated by the franchisor are referred to as company owned locations. When and if the franchisor sells a company owned location, the franchisor has considerable information about the historical earnings of the location. Does the franchisor
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A Post From the Field: Looking for Information about Other Franchise Models?
A question that I hear a lot is: what are other franchise models doing? Franchisors looking to restructure their fees want to know what other franchise models are doing. Persons looking to buy a franchise want to know if this
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Lesson From the Court: I did not do my diligence, but you negligently misrepresented the franchise!
Federal and state laws prohibit franchisors from making improper financial performance representations when selling franchises. State statutes and common laws prevent franchisors from making misrepresentations when selling franchises. What are improper financial performance representations? What constitutes a misrepresentation? In a
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A Post from the Field: Can I sell a franchise post April 30th?
Under the Federal Trade Commission’s (FTC) rule, Franchisors must update their franchise disclosure document (FDD) within 120 days from the close of the fiscal year. This update requirement is commonly referred to as the FDD annual update and includes such
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It is a Logo. It is a Copyright. No, it’s a Trademark.
You come up with an idea. You give it a name. It is your invention. You have created a work of art. You want to protect it from being stolen by others, but what is it? Is it a patent,
