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Cases, news, issues and legal opinions impacting franchise law

FTC Smacks The Entrepreneur’s Source over Buyer Deception

Terry Powell, founder of The Entrepreneur's Source talks about smart investing
Founder Terry Powell talks about franchise buying on YouTube

WASHINGTON, D.C. – While franchise brokerage/consultant firm The Entrepreneur's Source (TES) promotes its image as "helping people improve their lives," the Federal Trade Commission (FTC) found otherwise after launching an investigation into the firm's business practices regarding privacy and security.

UPS Charged $25M on Whistleblower Suit for Overcharging Feds

UPS truck and the UPS Store in NYCWASHINGTON, D.C. – The Department of Justice declared this week that United Parcel Services (UPS), the world's largest package shipping company, agreed to pay $25 million to resolve allegations of overcharging. UPS was accused of submitting false claims to the federal government in connection with its delivery of Next Day Air overnight packages.

NLRB Declares Franchisor Freshii Not a Joint Employer

On April 28, 2015 the National Labor Relations Board (“NLRB”), Office of the General Counsel, issued an Advice Memorandum to the NLRB’s Chicago area regional office finding that a restaurant franchisor and its Chicago area development agent are not joint employers with a Chicago franchisee.

NLRB Rules Freshii Not Employer of Franchisees

As franchisors and their attorneys brace themselves for rulings from the National Labor Relations Board on whether franchisors can be found to be a joint employer with their franchisees, they received a favorable decision this week. The answer from the NLRB's Division of Advice opined Freshii, a health food restaurant chain, was not a joint employer.

Marks & Klein’s Fatal Error in Representing ERA Real Estate Franchisees

Franchisees of ERA Franchise Systems have amended their malpractice lawsuit against franchisee law firm Marks & Klein for failing to limit the franchise owners' exposure to $383,000 in attorney fees. The award in favor of ERA was part of the underlying franchise agreement litigation that was brought by the real estate franchisor against the franchisees for breach of contract.

Franchisees Reassert Fraud Claims against Papa Murphy’s

VANCOUVER, Wash. – A court ruled last October that franchisees could move forward with their fraud and negligent misrepresentation claims against Papa Murphy's International, in order to give more detail to their allegations. Having denied the franchisor's motion to dismiss, the judge declared, "I'm not dismissing those claims at this point. I'm going to allow further discovery to be done by franchisees."

Court Disqualifies Franchisee Firm Marks & Klein for Paying 'Fact' Witness in 7-Eleven Case

A district judge ruled that Gerard "Jerry" Marks and his law firm Marks & Klein are disqualified from further participating in a franchisee lawsuit against 7-Eleven, Inc., claiming unlawful termination. His decision was centered on how Marks paid a witness, a former employee of 7-Eleven's asset protection department, to testify against the convenience store franchisor on how it treats franchisees.

Class Action Lawsuit Filed on Behalf of Terminated Coco's and Carrows Workers

Workers have filed a class action lawsuit against Catalina Restaurant Group and Food Management Partners over the mass firing of Coco's and Carrows employees, estimated by a former employee at over 3,000.

Adhesion Contract

A "take it or leave it" standard form contract in which one party is able to dictate almost all the terms of the agreement to the other party.

Jersey City Clears First Hurdle to Limit Chain Stores

Mayor Steve Fulop at ribbon cutting ceremony for Wonder Bages. Photo: mayor's office

JERSEY CITY – Mayor Steve Fulop's plan to limit the number of chain stores in downtown Jersey City passed 7 to 1 last night by its planning board. The proposition now moves to the city council for final approval.