How You Can Recover
the Losses Caused by Your Franchisor
Mitchell J. Kassoff, Esq. is an
attorney who deals exclusively in the litigation, business and corporate
aspects of Franchising and has been engaged in this area in all 50 states
since 1979. For complete information about Mr. Kassoff and to read the articles that he has published in Law Journals and
other publications see www.franatty.cnc.net/curricul.htm.
Mr. Kassoff provides complete services for litigation and all other areas of
Franchising. For complete information concerning all aspects of Franchising see www.franatty.cnc.net.
Unlike other attorneys and law firms who
engage in many areas of the law, Mr. Kassoff deals exclusively with
franchising. Which attorney or law firm would you want to represent you
and your interests, an attorney or law firm which
splits their interests and attention among many areas of the law or Mr. Kassoff
who spends his entire time exclusively on franchise matters? In
addition, unlike franchise companies and many other attorneys, Mr. Kassoff
represents both franchisors and franchisees in Court throughout the entire
United States. Since Mr. Kassoff represents both franchisors and franchisees he knows the weaknesses of both franchisors and
franchisees and can use them to best serve you in litigation and other
matters. Mr. Kassoff keeps current as to all matters concerning
franchising.
The vast majority of franchisors are
honest hardworking businessmen who honor their franchise agreements and
diligently work with their franchisees to make the franchise a success. Unfortunately, in any business there are always some people who
make errors or are not ethical. That is when an attorney who
specializes in and exclusively practices Franchise Law in all 50 states is
required. When you search an attorney to
represent your interests be certain to ask if his law firm practices Franchise
Law exclusively.
Mr. Kassoff has successfully litigated against Starbucks Coffee
Company, Dunkin’ Donuts Inc., Domino’s Pizza LLC, 7-Eleven Inc., The Southland
Corporation, Jimmy John’s Franchise, LLC, Jimmy John’s Enterprises, LLC, Great
Wraps, Inc., MaggieMoo’s International, LLC, I Can't Believe It's Yogurt Ltd.,
Candy Express Franchising Inc., Villa Pizza, LLC, Mr. Electric Corp., Wishwell
International, Inc., Best Western International Inc., Days Inns Worldwide, Inc.
(formerly known as Days Inns of America, Inc.), Nissan North America, Inc.,
Shell Oil Company, Black Entertainment Television Inc., United Airlines Inc.,
The Hertz Corporation, Horizon Blue Cross, Blue Shield of New Jersey, LaSalle
National Bank, United States Internal Revenue Service, Attorney General of the
State of New York, New York State Department of Taxation and Finance, Woolworth
Corporation, Motiva Enterprises L.L.C., Allegiance
Telecom Company Worldwide, Allegiance Telecom of New York Inc., Equilon Enterprises L.L.C., Equiva Trading Company, Venator
Group Inc., Public Service Electric & Gas, Brice Foods Inc., Fremont
Financial Corporation, and numerous other companies which are not nationally
known.
If you wish
Mr. Kassoff to make an analysis of the possibility of suing your Franchisor,
send the Franchise Disclosure Document/Uniform Franchise Offering Circular, the
executed Franchise Agreement, a detailed explanation as to any falsehoods told
to you by the Franchisor that induced you to purchase the franchise and
anything the Franchisor promised and failed to do to: Mitchell J. Kassoff,
Esq., Two Foster Court, South Orange, New Jersey 07079-1002 together with your
check in the amount of $500 ($535 if you wish the documents returned to
you). The use of Federal Express is strongly recommended
(call 800-Go-FedEx and FedEx will pick up the package at your home or
office). Do not send anything by U.S. Postal Service Express Mail,
Certified Mail or Registered Mail. If you have any of these documents in
electronic form, in addition to mailing the hard copies you should send them by
e-mail to Mr. Kassoff.
You can pay all or part of
your bill with your MasterCard, VISA, American Express or Discover Card through
PayPal, if you pay the fee charged by PayPal.
Unless you request otherwise, it
is Mr. Kassoff’s policy to aggressively and tenaciously
prosecute your case against a franchisor that has acted improperly and
harmed you.
If
You are being Threatened by or Wish to Sue Your Franchisor
If you have been wronged by your franchisor and your franchisor will
not compensate you for its improper actions, you must either accept defeat for
all of your losses and the time that you have expended on your franchise by
giving up, or sue you franchisor to obtain the monetary and other relief to
which you might be entitled.
Mitchell J. Kassoff, Esq. handles
Franchise Litigation in all 50 states. Since Mr. Kassoff deals exclusively
with Franchise Law on a daily basis he is extremely
familiar with Franchise Law. This means that there are many issues which he already knows that will not require legal
research on his part, which is not true for attorneys who deal with other areas
of the law. These other attorneys will have to perform legal research
(and charge you for it) for work that Mr. Kassoff would not have to
perform. Therefore, in many cases on a true cost basis, Mr. Kassoff’s
hourly fee is effectively less than an attorney who has a far lower hourly rate.
It is possible
that you are being threatened by your Franchisor and wish to have an attorney
represent you to protect your rights, investment and interests before you say
or do something that could cause you to lose your franchise without
compensation. In fact, in some cases, the mere fact that you are
represented by an attorney who is an acknowledged expert in Franchise Law such
as Mr. Kassoff may cause the Franchisor to cease harassing you. When
litigation or arbitration is not yet initiated by either side Mr. Kassoff’s
retainer is $10,000, with work being performed at his usual hourly rate.
If you wish to
sue your franchisor, it is highly recommended that you combine your efforts with
other franchisees that have similar law and fact grievances by having them join
your lawsuit and/or arbitration as plaintiffs against your franchisor. By
doing this you will be able to pool your information and be in a position to
have a greater chance of success as to the prosecution of your case. This
will also reduce your litigation costs. Even though each plaintiff
will have to pay his own full initial retainer, you will be able to divide the
hourly billing rate among all of the plaintiffs.
You can pay all or part of your bill
with your MasterCard, VISA, American Express or Discover Card through PayPal,
if you pay the fee charged by PayPal.
Arbitration
against your Franchisor
A large percentage
of Franchise Agreements provide that disputes between the franchisor and
franchisee must be resolved by arbitration. This is usually stated in a
paragraph near the end of the Franchise Agreement labeled “arbitration” or
“dispute resolution.” You will also be able to determine if arbitration
is to be employed for dispute resolution in Item 17(u) of the disclosure
portion of the Uniform Franchise Offering Circular/Franchise Disclosure
Document, which is placed first in the Uniform Franchise Offering
Circular/Franchise Disclosure Document package.
If arbitration
must be employed for dispute resolution, you have three alternatives as to
retaining the legal services of Mr. Kassoff for your case against your
franchisor.
The first method is a modified contingency basis for which you will pay
for Mr. Kassoff’s services at the rate of $250 per hour, (plus cash out of
pocket costs, “Disbursements”) plus a percentage of the monies collected from
the Franchisor and will be saved as a result of the Arbitration for the balance
of the term of the Franchise Agreement. A retainer in the amount of $5,000, plus Disbursements will be
required.
The second method is a modified contingency basis for which you will
pay for Mr. Kassoff’s services at the rate of $330 per hour, Disbursements plus
a smaller percentage basis than the first method out of the monies collected
from the Franchisor and will be saved as a result of the Arbitration for the
balance of the term of the Franchise Agreement. A retainer in the amount of $15,000, plus Disbursements will be
required.
The third method
is to pay for Mr. Kassoff’s services at his usual rate of $495 per hour (plus
Disbursements) with a retainer required in the amount of $30,000, plus
Disbursements. By using this method you will
receive the entire recovery from the franchisor.
It is strongly
suggested that you contact other franchisees to join the arbitration. By
doing this you will be able to pool your information and be in a position to
have a greater chance of success as to the prosecution of your cases.
This will also reduce your litigation costs. Even though each
plaintiff will have to pay his own full initial retainer, you will be able to
divide the hourly billing rate among all of the plaintiffs.
You can pay all or part of your bill
with your MasterCard, VISA, American Express or Discover Card through PayPal,
if you pay the fee charged by PayPal.
Lawsuit
against your Franchisor
If there is no
arbitration provision in your Franchise Agreement you
must sue your franchisor in court. You have
three alternatives as to retaining the legal services of Mr. Kassoff for your
case against your franchisor.
The first method is a modified contingency basis for which you will pay
for Mr. Kassoff’s services at the rate of $250 per hour, Disbursements and the
balance will be paid to Mr. Kassoff on a percentage basis out of the monies
collected from the Franchisor and will be saved as a result of the litigation
for the balance of the term of the Franchise Agreement. A retainer in the amount of $30,000 will be
required, plus Disbursements.
The second method is a modified contingency basis for which you will
pay for Mr. Kassoff’s services at the rate of $330 per hour, Disbursements and
the balance will be paid to Mr. Kassoff on a smaller percentage basis than the
first method out of the monies collected from the Franchisor and will be saved
as a result of the litigation for the balance of the term of the Franchise
Agreement. A retainer in the
amount of $30,000 will be required, plus Disbursements.
The third method
is to pay for Mr. Kassoff’s services at his usual rate of $495 per hour (plus
Disbursements) with a retainer required in the amount of $30,000, plus
Disbursements. By using this method you will
receive the entire recovery from the franchisor.
It is strongly
suggested that you contact other franchisees to join the lawsuit. By
doing this you will be able to pool your information and be in a position to
have a greater chance of success as to the prosecution of your cases.
This will also reduce your litigation costs. Even though each
plaintiff will have to pay his own full initial retainer, you will be able to
divide the hourly billing rate among all of the plaintiffs.
You can pay all or part of your bill
with your MasterCard, VISA, American Express or Discover Card through PayPal,
if you pay the fee charged by PayPal.
If
you are Sued by your Franchisor
In this case for
Mr. Kassoff to defend you and protect your rights as a franchisee, your
investment and the time you have spent on your enterprise all work must be paid
on an hourly basis at his usual hourly rate, plus disbursements. A
retainer in the amount of $30,000 will be required.
You should note
that if you have been improperly wronged by your franchisor you can counterclaim
against your franchisor if you are sued with your franchisor proceeding in
either an arbitration proceeding or a lawsuit. This counterclaim takes
place in the same proceeding as the arbitration or lawsuit initiated by the
franchisor. In this case the entire amount
recovered from the franchisor will belong to you.
It is strongly
suggested that you contact other franchisees to join the lawsuit by way of
Counterclaims. By doing this you will be able to pool your information
and be in a position to have a greater chance of success as to the prosecution
of your cases. This will also reduce your litigation costs. Even
though each franchisee will have to pay his own full
initial retainer, you will be able to divide the hourly billing rate among all
of the franchisees.
You can pay all or part of your bill
with your MasterCard, VISA, American Express or Discover Card through PayPal,
if you pay the fee charged by PayPal.
Actions
by a Franchisor that Might Provide Justification for a Franchisee to Sue his Franchisor
The following is a partial list of cases
that might give rise to a successful lawsuit by a franchisee against his
franchisor:
1. The franchisor
did not provide a properly drafted Uniform Franchise Offering
Circular/Franchise Disclosure Document to the franchisee.
2. The franchisor did not properly file and
have its Uniform Franchise Offering Circular/Franchise Disclosure Document
approved by your state prior to the time it offered the franchise for sale to
the franchisee.
3. The Uniform
Franchise Offering Circular/Franchise Disclosure Document was not given to the
franchisee at least ten business days prior to taking any money from the
franchisee.
4. The Uniform
Franchise Offering Circular/Franchise Disclosure Document was not given to the
franchisee at least ten business days prior to having the franchisee execute
any agreements.
5. The franchisor
exaggerated any aspect of the franchise to the franchisee in order to induce
the franchisee to purchase the franchise.
6. The franchisor
lied to the franchisee in order to induce the franchisee to purchase the
franchise.
7. The franchisor
provided inaccurate written or verbal statements as to the profitability,
costs, capital requirements or initial expenses pertaining to the operation of
the franchise.
8. The franchisor
provided inaccurate written or verbal statements as to the need for specialized
training required for the operation of the franchise.
9. The franchisor
provided inaccurate written or verbal statements misrepresenting that certain
industry leaders are affiliated with the franchise.
10. The franchisor provided inaccurate
written or verbal statements as to the success rate of the franchise.
11. The franchisor had a lack of support
and/or continuing assistance as to the franchise.
12. The franchisor did not provide the
services, assistance and/or products that were promised to the franchisee.
13. The franchisor opened company owned
locations and/or other franchised locations near the franchisee’s location.
This action in some cases will still be actionable against the franchisor
even if the Franchise Agreement did not provide an exclusive territory to the
franchisee.
14. The franchisor stopped offering a product
and/or service for sale.
15. The franchisor required the franchisee to
sell a product and/or service.
16. The franchisor required the franchisee to
purchase goods and/or services from specific providers, even though the same
quality items were available from other sources at lower prices.
17. The franchisor used the funds taken for
advertising from the franchisee for other purposes.
18. The franchisor terminated the franchise
without good cause.
19. The franchisor wrongfully terminated the
Franchise Agreement with his franchisee.
20. The franchisor terminated the Franchise
Agreement with his franchisee ostensibly because of improper quality control or
other reasons, when the real reason was to take over that particular location.
21. Even if the franchisor followed the terms
of the Franchise Agreement, he did not act in good faith with his dealings with
the franchisee.
22. The Franchisor did not follow the
appropriate state and federal laws.
Your contract may state that you are
required to sue your franchisor in his home state. However, some state
statutes and courts will not uphold this provision, which will allow a
franchisee to sue his franchisor in the franchisee’s home state (see www.franatty.cnc.net/NYSBAChoiceofForum.pdf).
Analysis of the Franchise Agreement
Ambiguity
of your franchise contract
It is possible that your
franchise agreement is either confusing or ambiguous. This is the case if
the franchise agreement is reasonably susceptible to two or more different
interpretations. A contract does not become “ambiguous” merely
because the Franchisor and franchisee differ as to
what it means, the differing positions must each be reasonable.
The task of contract interpretation
is generally defined as determining the “intent of the parties” as revealed by
their written language. Of course, this task is
much more difficult when the parties had different, even adversarial
intentions, a situation that invites the courts to impose their view of what a “reasonable”
man would have intended in light of the words that were chosen.
An agreement provides that the franchisor shall not open any competing locations within a defined
franchise territory. Is the franchisor barred
from soliciting Internet sales in the territory? Mail order sales? What do the words “shall not open a
location” really mean? Does precedent regarding older technology provide
a clue toward interpreting what the parties “agreed to” regarding the
Internet? An agreement provides that the franchisee is
licensed to conduct business at a specific location or within a specific
territory? The word “exclusive” is not mentioned. How is the
question of exclusivity decided? Is it automatically not exclusive?
Even if it is not exclusive, can the franchisee argue that any degree of
territorial protection is expressly or impliedly
created the Agreement? An agreement provides that the franchisor agrees to “furnish national account leads”
to the franchisee. What does it mean to “furnish” a business
“lead?” How is a “national account” defined,
absent a definitional clause elsewhere in the agreement? Is the “duty” to
“furnish national account leads impacted by the question of whether the franchisee
has a defined territory in which it might attempt to service a national
account?
An agreement provides that
the franchisor may designate the sources of
supply. From this language alone, is the franchisor
able to derive a profit in the form of supplier rebates? If the rebate
is permitted, because among other things it was disclosed in the Uniform
Franchise Offering Circular/Franchise Disclosure Document, is there any
limit on the amount of the rebate, or the price that the franchisee may be charged?
An
Agreement contains an “integration clause” that provides that the written
agreement is the complete agreement and that there are “no other oral or
written agreements between the parties.” Does this language
preclude the franchisee from arguing that he was fraudulently induced to
sign the agreement by the franchisor's
pre-contractual representations? Does your
answer change if the Franchise Agreement provided that there are “no other
oral or written agreements or understandings between the parties?
“Exactly what is an “understanding” when included
in an integration clause?
How could
reasonable men disagree on the meaning of a written agreement?
One party or the
other might have preferred to leave the agreement ambiguous for it feared an
adverse result if the issue was clarified in the process of
negotiations. In other words, “no one would sign the agreement if
they knew what I really meant.” Or, the drafter
might have failed to anticipate the real life situations that might
arise in the life of the franchise, leading to questions about what the contract
meant. An agreement may become ambiguous over time, when business
conditions change, witness the confusion created by the Internet as applied to
pre-Internet agreements.
How do courts or arbitrators
address cases of confusing contracts?
The
first task is to determine whether the agreement is, in fact,
ambiguous. The stated test is whether the agreement (or the
disputed portion of the agreement) is reasonably susceptible to two or more
different interpretations.
Judges, not
juries, decide whether an agreement is ambiguous
There is no perfectly
clear standard for applying the test of whether an agreement is reasonably
susceptible to two or more interpretations. On this point, there
is a distinction between intrinsic ambiguity (which is established based
upon the “four corners” of the Franchise Agreement) and extrinsic ambiguity,
whereby the agreement is ambiguous by reference to an extrinsic fact,
such that the contract would make no sense if it were interpreted
literally. The parties may seek to introduce such evidence for the purpose of establishing ambiguity, as opposed
to the usual purpose of introducing evidence to resolve ambiguity.
The danger is that judges may place themselves in the position of ultimate fact-finder
and resolve ambiguity in favor of one party or the other, in the guise of
declaring that an agreement is not ambiguous.
The Implied
Covenant of Good Faith and Fair Dealing
The role of the implied
covenant of good faith and fair dealing cannot be ignored in any discussion
of ambiguous or confusing franchise agreements. In almost every
jurisdiction, the implied covenant of good faith and fair dealing is
implied as a matter of law in every contract absent express
disavowal. The implied covenant may not replace express terms in the
contract, but it may supplement the express terms. Where a party
to a contract retains discretion as to performance of contract terms,
the covenant requires that party “not exercise his discretion
arbitrarily, capriciously, or in any manner inconsistent with his co-party's
reasonable business expectations.”
These are just some of the many aspects as to this area of
franchise law.
Possible
Results of a Franchisee Suing his Franchisor
Each situation between a franchisor and
his franchisee is different. The following is a partial list of results
that a franchisee who has retained an attorney that specializes in and
exclusively practices Franchise Law might obtain from a franchisor.
1. If desired by the
franchisee, the franchise relationship between the franchisor and the
franchisee is terminated.
2. The initial
franchise fee is returned to the franchisee.
3. The initial costs
and expenses to set up the franchise is paid to the
franchisee.
4. The franchisee is
compensated monetarily if the franchisor opens company owned locations and/or
additional franchises in the vicinity of the franchisee’s
area of operation, even if this is allowed by the Franchise Agreement.
This is usually calculated by the amount of lost profits that the franchisee
has incurred.
5. The franchisee
obtains monetary compensation from the franchisor for the financial losses that
have been suffered by the franchisee.
The franchisee obtains the profits that he would have made in the
franchise for the life of the Franchise Agreement (usually ten years) if the
franchisor had not committed his improper actions.
Actions that a Franchisee Should Take to
Protect his Rights as a Franchisee
Although no franchisee wishes to concern
himself with the possibility of entering into litigation with his franchisor,
the possibility does exist. Accordingly, you should be aware of your
legal rights and the legal strategies for: (1) resolving the problem, (2)
avoiding termination and (3) recovering compensation in the event the
franchisor has acted in a manner that has caused injury to your franchise or
business.
If any problems begin to arise between
you and your franchisor, you should not hesitate to
immediately contact an attorney that specializes and exclusively
practices Franchise Law. You do not wish to retain an attorney
whose practice includes multiple areas of the law, thus reducing his knowledge
and time commitment to Franchise Law. This is when you most need to
consider seeking competent legal advice to plan a future course of
action.
The worst possible thing a franchisee can
do when problems arise is nothing. Too often, when problems arise (due
either to the external business environment or some act of the franchisor), the
franchisee has a feeling of helplessness and disbelief. These feelings of
helplessness and disbelief often lead to inaction and the loss of valuable
rights. The longer you wait, the more difficult it will
be to recover the monies that are due to you that you could obtain in court.
If the franchisor wishes to act quickly, the franchisee can lose everything with in a matter of days. Accordingly, once a problem
begins it is extremely important that the franchisee immediately seek an
attorney that specializes and exclusively practices Franchise Law.
If you have fallen behind on your royalty
payments and/or other sums due to the franchisor, be wary of the potential of
receiving a default notice. Your franchise agreement is a contract and
you must always expect the franchisor will act in accordance with that contract
against your interests, including the termination of your franchise.
There are ways of avoiding termination. First, the franchisee can
negotiate a written solution to the problem, such as a written extension of the
due date and written payoff schedule. The franchisee must be certain not
to accept oral promises and must never execute a release without first speaking
with an attorney that specializes and exclusively practices Franchise
Law. If your franchise agreement is terminated, it will be very difficult
to prove the oral promises. In addition, most franchise agreements
expressly exclude any reliance on oral promises or representations.
Sometimes, as part of negotiating a
problem (or in granting a franchisee a franchise renewal), the franchisor will
request that the franchisee execute a release of claims. This release
usually states that the franchisee agrees to “release” (i.e., give up) all
rights to sue the franchisor for past acts which may have caused harm to the
franchisee. The release will usually include all acts of the franchisor
and his agents. The release will prevent you from suing the franchisor in
the future for any losses that you incurred. Therefore, if you execute a
release, you may be giving away valuable legal rights. For instance, if
sales at your franchise are depressed due to encroachment, signing a release
may prevent you from ever recovering from the franchisor for any damage (past,
present or future) caused by the encroachment. Thus, if your financial
problems are caused by something that the franchisor has done, signing a release
may act to prevent you from ever recovering for the harm caused to you by the
franchisor. This should never be done without first consulting with an
attorney that specializes and exclusively practices Franchise Law
Although nobody wishes to think about the possibility of having
problems with their franchise and franchisor, the prudent franchisee knows his
legal rights and prepares for the possibility of one day having to deal with
such problems. Accordingly, a franchisee should at least educate himself in advance, as to what to do and what not to do, in
the event a problem does arise. In this way, if a problem ever does
arise, the franchisee will have given himself a
fighting chance.
Actions
a Franchisee Should Take to Protect His Investment in His Franchise
Pay attention to how the franchisor
runs his business.
Whatever happens
to your franchisor will sooner or later affect
you. So stay in close touch with the home office. Develop a
personal relationship with someone on the inside. That is usually your
best route to obtaining straightforward information that can be very important.
Get a copy of
each year’s Uniform Franchise Offering Circular/Franchise Disclosure
Document. The Uniform Franchise Offering Circular/Franchise Disclosure
Document will report important information that must be disclosed, such as
the number of franchises sold, bought back or terminated and the details of any
lawsuits pending or settled. By comparing Uniform Franchise Offering
Circular/Franchise Disclosure Document data from year to year you can get a
current snapshot of how contented your fellow franchisees seem to be and what,
if any, major problems they are encountering. This will alert you to
issues that may confront you in the future.
Pay attention to
the company newsletter, even if it's mainly a gossip
sheet. See whether there's an exceptional number
(more than 15% a year) arriving or departing employees in middle
management. This often signals that something is amiss at headquarters,
such as a lack of consistent direction, little management consensus or
financial distress.
If you do spot
signs of instability, depending on the severity, you may want to put expansion
plans on hold or even consider selling out before trouble drives down the price
of your investment.
Equalize the odds.
Even if your
relationship with your franchisor is idyllic, never forget that his power is
greater than yours, and you should always do whatever
you can to strengthen your position.
You should always
ask for everything he says in writing and save everything
you get. Even documents that seem innocuous can be useful persuaders in
the future.
Deal with problems right away.
Speak up
immediately if there are any problems. If you are a new franchisee and your
location is not producing the traffic you need.
Ask your franchisor to use his influence to negotiate a better deal with your
landlord or a swap for another property. Once poor traffic has pushed you
into the low-volume category, you will have less influence with your
franchisor.
Guard your territory.
Some franchisors
make their profits primarily by selling products and services through
franchisees, so it is in their interest to see individual businesses
grow. Others make most of their money by selling franchises, which makes
individual growth less important or not important at all, so you must protect
your territory zealously.
Once another
franchisee opens up shop nearby it will be just about impossible to remove
him. You must be on the alert for sings of expansion in you area. Make friends with local real estate
salesmen and lenders who can alert you to inquiries from would-be
franchisees. The instant you hear of one, protest in writing to
the franchisor immediately. Even if the infringement does not violate
your contract you may have a strong position.
You should immediately consult an experienced an attorney that specializes and
exclusively practices Franchise Law.
Keep a sharp eye on contract
renewals.
When business is
prospering, a franchisee can easily ignore the fact that he owns a limited
license, not a perpetual right. That can be a mistake, sometimes a fatal
one, at contract renewal time. This is particularly important when a
franchisor wants to eliminate a contentious franchisee or to earn higher
royalties. Your best defense is a strong offense.
Join with other franchisees to
settle disputes.
If your franchise
has an independent franchisees' association become an
active member. There is strength in numbers. It's
hard for a franchisor to claim that you are a poor businessman if you can prove
other franchisees are similar problems.
If your franchise
lacks an association, consider starting one. This should be done with an
attorney that specializes in and exclusively practices Franchise Law
Make contingency plans for your
future.
No matter how
well things are going, do not ever forget that what you primarily own is a
license, not a business. That is why it is only prudent to develop
alternative plans for your future, just in case your contract is not renewed or
you become unhappy with the franchise or the franchisor.
If you have
learned business skills, made useful contacts and have set aside spare
earnings, you have a solid foundation for your next move. But it is also wise to draw up a plan of what you would do
if forced to make a change. There are no gold watches being awarded in
corporations anymore. Do not count on your franchise being forever
either.
For complete information about
franchising, see http://www.franatty.cnc.net/
Mr. Kassoff provides litigation,
business, corporate and other assistance for all areas of franchising. To see Mr. Kassoff’s resume and
copies of articles that he has had published see www.franatty.cnc.net/curricul.htm.
If you have any questions, please feel free to contact Mr.
Kassoff by e-mail at franchiselawyer@verizon.net.
You can also
reach Mr. Kassoff by telephone at (973) 762-1776 from 9:00 A.M. to 5:00 P.M.
Eastern time Monday through Friday or by mail at Two Foster Court, South
Orange, New Jersey 07079-1002
Uniform Franchise
Offering Circular/Franchise Disclosure Document register registration contract
agreement registration franchisor franchisee franchise franchiser attorney
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