A federal district court in New Jersey recently found that restaurant franchisor Golden Corral was entitled to nearly $1.2 million in consequential damages after terminating a franchised Golden Corral restaurant....more
A Pennsylvania federal court refused to enforce non-competition and non-solicitation covenants in a franchise agreement of a nationwide tax preparation service franchisor. The court dismissed the franchisor’s request for...more
A Michigan district court held a franchisee breached its obligations under its franchise agreements and upheld the liquidated damages clause in the agreements....more
The Second Circuit Court of Appeals affirmed a district court’s order denying a franchisor’s request for preliminary injunction against a terminated franchisee to enforce covenants not to compete or solicit former clients....more
A federal district court denied a pizza franchisor’s motion to dismiss a former franchisee’s complaint, finding the former franchisee sufficiently pleaded the franchisor coerced the franchisee into signing a general release....more
A federal district court in Michigan granted franchisor Little Caesar Enterprises, Inc. (LCEI) a default judgment against its former franchisee for violating the terms of the franchise agreement....more
A federal district court in New Jersey denied Travelodge Hotels’ motion for partial summary judgment against a former franchisee, holding there are genuine issues of fact as to Travelodge’s breach of contract claims....more
Claims by a window sales and installation franchisee against its franchisor were dismissed by a federal district court in Michigan because the franchisee did not comply with the prelitigation mediation procedure in the...more
A New Jersey federal court denied a franchisor’s motion for preliminary injunction against a franchisee due to franchisor’s 11 month delay in bringing the motion. Franchisee entered into two franchise agreements with H-1 Auto...more
A federal district court in Nevada partly denied a franchisor’s summary judgment motion on claims brought by a franchisee.
IJL Midwest entered into several franchise agreements with a franchisor of a dating and...more
A federal court in Virginia denied tax franchisor, Liberty Tax’s, motion to dismiss complaints by two of its area developers (“ADs”). The ADs claimed Liberty Tax breached their contract for wrongfully terminating, failing to...more
2/28/2022
/ Breach of Contract ,
Contract Disputes ,
Contract Drafting ,
Contract Renewal ,
Contract Termination ,
Contract Terms ,
Development Agreements ,
Failure To Pay ,
Franchise Agreements ,
Franchisee ,
Franchisors ,
Motion to Dismiss ,
Royalties ,
Wrongful Termination
A franchisee sued its franchisor, OsteoStrong Franchising, LLC, in Texas federal court after OsteoStrong terminated the franchise and development agreements. Termination occurred after the franchisee failed to timely develop...more
An area developer entered into three agreements with a pizza franchisor and developed 50 franchises in Texas. The franchisor, Pizza Inn, Inc., tried to terminate all three contracts, though each had a twenty-year initial term...more
A federal court in Louisiana granted a preliminary injunction against a former franchisee of Liberty Tax Service for breaching post-termination covenants under a franchise agreement.
Liberty Tax entered into franchise...more
A franchisee sued real estate franchisor Century 21 for a declaration whether the franchisee could end its franchise agreement early despite a provision that deleted the franchisee’s early termination right. Noting the...more
On competing motions for a temporary restraining order (“TRO”) by ReBath – a nationwide bathroom remodeling franchisor, and its terminated franchisee, ReBath prevailed in restraining the ex-franchisee’s further operations. A...more
6/30/2021
/ Breach of Contract ,
Contract Termination ,
Counterclaims ,
Covenant of Good Faith and Fair Dealing ,
Failure To Pay ,
Franchise Agreements ,
Franchisee ,
Franchisors ,
Implied Covenants ,
Lowe's ,
Royalties ,
TRO
A federal court in Michigan granted 7-Eleven’s motion for summary judgment, enforcing the franchisor’s right to terminate a franchisee with repeated defaults, even though each default had been cured.
7-Eleven’s franchise...more
The Sixth Circuit Court of Appeals recently affirmed a $2.6 million award of liquidated damages in favor of a pizza franchisor and a summary judgment order enforcing termination of franchise agreements due to nonpayment and...more
Lola Salamah and Amro Elsayed signed a franchise agreement with M.M. Fowler, Inc., the franchisor of Family Fare gas stations, to operate a gas station franchise in North Carolina.
A few years into the franchise...more
A federal court in Nashville granted summary judgment on breach of contract claims in favor of a damage restoration franchisor’s lawsuit with a former California franchisee.
A Servpro franchisee had a territory in Los...more
A federal district court in Michigan granted a preliminary injunction in favor of tax preparation franchisor, Liberty Tax Service (JTH Tax, Inc. v. Magnotte, E.D. Mich., ¶16,575), finding it was likely to succeed on its...more
5/1/2020
/ Anti-Competitive ,
Breach of Contract ,
Contract Termination ,
Customer Lists ,
Franchise Agreements ,
Franchisee ,
Franchises ,
Franchisors ,
Irreparable Harm ,
Loss of Goodwill ,
Lost Profits ,
Non-Compete Agreements ,
Preliminary Injunctions ,
Tax Preparers
A Wisconsin pizza maker, Heggie’s Pizza (Heggie’s) argued that its relationship with a purported pizza distributor A & B Distribution (A&B), did not meet the Wisconsin Fair Dealership Law (WFDL) definition of a “dealership.”...more
2/5/2020
/ Breach of Contract ,
Community of Interest ,
Contract Termination ,
Dealerships ,
Distributors ,
Food Manufacturers ,
Food Safety ,
Franchise Acts ,
Franchise Agreements ,
Franchisee ,
Good Cause ,
Notice Requirements ,
Oral Contracts ,
Right To Cure ,
State Law Claims
A federal district court upheld an arbitration panel’s decision to deny attorneys’ fees to Benihana, even though Benihana won a dispute with its licensee. The licensee started arbitration claiming Benihana breached the...more
3/29/2019
/ Appeals ,
Arbitration ,
Arbitration Awards ,
Attorney's Fees ,
Breach of Contract ,
Contract Termination ,
Franchise Agreements ,
Franchisee ,
Franchisors ,
Good Cause ,
License Agreements ,
Licensees ,
Prevailing Party ,
Reaffirmation ,
Restaurant Industry
A Wisconsin federal judge granted summary judgment in favor of a food service and cleaning equipment maker (“Stoelting”), ruling that minimum purchase requirements under two dealer agreements were not a franchise fee under...more
1/31/2019
/ Contract Termination ,
Dealerships ,
Franchise Agreements ,
Franchise Fees ,
Franchise Termination ,
Franchises ,
Good Cause ,
Manufacturers ,
Minimum Purchase Requirements ,
Purchase Agreement ,
Summary Judgment ,
Wholesale ,
Written Notice
A bankruptcy court has found that Applebee’s failed to properly terminate its franchise agreements prior to the franchisee petitioning for bankruptcy. Therefore, the franchise agreements remained in effect and were property...more
12/28/2018
/ Applebee's ,
Commercial Bankruptcy ,
Contract Termination ,
Contract Terms ,
Franchise Agreements ,
Franchisee ,
Franchises ,
Franchisors ,
Notice of Default ,
Right To Cure ,
Royalties