3 Key Takeaways | Is Franchising Doomed? The 2024 Version
Is Franchising Doomed?
II-27 - Our 1st Anniversary Special: Bringing Back Our Inaugural Guest to Discuss What Was and What Will Still Be With President Trump
Employment Law This Week: Break Pay, Misclassification of Franchisees, California Computer Professional Exemption, Non-Compete Payment
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
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
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
On February 27, 2025, the District of Minnesota granted a franchisor’s motion to dismiss a lawsuit initiated by its franchisee, alleging, among other things, breach of contract and misappropriation of trade secrets under the...more
A federal court in North Dakota recently denied a motion to dismiss vicarious liability claims against the corporate entities constituting the Subway franchise system. C.S. v. Subway Worldwide, Inc., 2025 WL 472475 (D.N.D....more
The Superior Court of Pennsylvania recently affirmed a judgment holding Domino’s Pizza vicariously liable for a motorcycle accident involving a franchisee’s delivery driver. Coryell v. Morris, — A.3d —, 2025 Pa. Super. 28...more
A federal court in California recently granted Ringside Development Company’s motion to stay a franchisee-initiated lawsuit pending resolution through alternative dispute resolution. Jameson v. Ringside Development Company,...more
A federal court in Arizona recently granted a franchisee’s motion for temporary restraining order preventing termination of its franchise agreement and the franchisor’s withdrawal of any funds from the franchisee’s accounts....more
A New Jersey Court of Appeals found that a retailer was not a franchisee under New Jersey’s Franchise Practices Act (NJFPA) and therefore NJFPA’s termination requirements did not apply to the retailer’s termination....more
A district court in Arizona granted a franchisor’s motion to transfer venue to Missouri pursuant to the terms of the franchise agreement. S&G Elite LLC (“S&G”) and ST National Franchising, LLC (“Franchisor”) entered into a...more
The International Franchise Association’s Annual Convention is always filled with useful take home information for franchise practitioners. Last week, I attended the session “Proactive Strategies for Franchisors to Prevent...more
A New Jersey appellate court affirmed a state trial court’s ruling that a terminated retailer of custom outdoor kitchens was not in a franchise relationship with a manufacturer of outdoor grills and that the New Jersey...more
While 2024 saw more stability in the financial markets than 2023, many challenges arose in 2024 for franchised businesses, manufacturers and retail chains, including bankruptcies of many large restaurant and retail chains,...more
On January 31, 2025, Delegate Marc Korman of Montgomery County introduced Maryland House of Delegates Bill 992, entitled the Franchise Reform Act, which would make the first significant changes to the Maryland Franchise...more
Last May, the Federal Trade Commission looked to ban non-compete agreements in most employment contracts aside from franchise agreements. Although scheduled to become effective in September, a federal court vacated the ruling...more
Four days before President Trump took office, the Department of Justice (“DOJ”) and Federal Trade Commission (“FTC”) (together, “the Agencies”) under the Biden administration released their “Antitrust Guidelines for Business...more
A California federal court partially granted a motion to compel arbitration by car care franchisor Spiffy Franchising. However, the court invalidated provisions in the franchise agreement providing for dispute resolution in...more
A Mississippi federal court granted summary judgment in favor of Leisure Systems, Inc. (“LSI”), a franchisor of Yogi Bear themed children’s parks and campgrounds, on negligence and premises liability claims. The case was...more
Deciding whether to choose state or federal court can be outcome determinative. This is particularly important in deciding to remove a case from state to federal court. Some state franchise statutes clearly allow a court to...more
The Los Angeles wildfires pose significant challenges for businesses, including franchised businesses. But if a business is lost in a national disaster, support already exists within a franchise system. It’s organic. That is...more
A federal court in Ohio recently narrowed two hotel franchisors’ attempt to implead their franchisee in a lawsuit under the Trafficking Victims Protection Reauthorization Act (TVPRA). A.S. v. Red Roof Inns, Inc., 2024 WL...more
In a franchisor’s suit against its franchisee and that franchisee’s new business, a federal court in Kansas recently denied the new business’ motion to dismiss for lack of personal jurisdiction. HappyFeet-Legends Int’l, Inc....more
A new exemption to the Digital Millennium Copyright Act (DMCA) allows McDonald’s employees, franchise owners, and others to fix McDonald’s often out-of-order ice cream machines. Prior to this exemption, most McDonald’s ice...more
The California Court of Appeals upheld a lower court’s decision finding that a Texas court had personal jurisdiction over a California franchisee. GlobalCFO, LLC and GlobalCFO Franchise, LLC (collectively, “GlobalCFO”),...more
If you ask for a definition of "franchise" in California law, there are at least three answers. Two are statutory and one is judicial. Corporations Code Section 31005 defines "franchise" for purposes of California's...more