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|“Frustrating” Decision Highlights Alternate Approach to Rescission Claims|
Carly Cohen; Cassels Brock & Blackwell LLP;
October 14, 2014, previously published on October 8, 2014In the recent appeal of Dhillon v PM Management Systems Inc., an Ontario Superior Court judge upheld the decision of a Deputy Judge of the Small Claims Court, granting a franchisee’s claim for the return of an initial, non-refundable franchise fee.
|Deli Franchisor’s Disclosure Misses the Mark: Lessons From DeliMark Café|
Christopher Horkins; Cassels Brock & Blackwell LLP;
October 14, 2014, previously published on October 8, 2014In the recent case of 2237310 Ontario Inc. v. 2264145 Ontario Inc. the Ontario Superior Court of Justice granted a declaration of rescission on summary judgment to a franchisee as a result of numerous disclosure failures. The case provides a helpful reminder of the need to ensure compliance with...
|Brand Protection: The Case for Franchisor Auditing and Enforcement of Franchise Agreement Compliance Clauses|
Mary E. Pivec; Ford & Harrison LLP;
October 7, 2014, previously published on October 3, 2014Executive Summary: The recent criminal prosecution of several 7-Eleven franchisees, which arose out of a criminal alien employment investigation, as well as efforts by government agencies to treat franchisors and franchisees as joint employers for the purposes of liability under federal labor and...
|Developmental Costs: Texas Comptroller Rules Essential Preparatory Costs Cannot Be Accounted for in Apportionment Factor|
Ted W. Friedman, Prentiss Willson; Sutherland Asbill & Brennan LLP;
October 3, 2014, previously published on September 29, 2014The Texas Comptroller determined that for Texas franchise tax purposes the apportionment factor of an out-of-state taxpayer engaged in the provision of technical training could not be adjusted to account for certain costs incurred in preparing and marketing the training sessions. The training...
|Restaurant Franchisors Targeted by NLRB and DOL for Claims They are Joint Employers of Franchisees' Employees|
L. Grant Close, David A. Prather; Ford & Harrison LLP;
September 29, 2014, previously published on September 26, 2014Restaurant franchisors are facing efforts from both the National Labor Relations Board (NLRB) and the U.S. Department of Labor (DOL) to make them joint employers of franchisees' employees. The Board's efforts have caught the attention of Congress where a House subcommittee held a hearing on the...
|Ontario Court Certifies Franchise Encroachment Claim as Class Action|
Sarit E. Batner, Helen Fotinos, Adam Ship, Thomas N.T. Sutton, Tyler Wentzell; McCarthy Tétrault LLP;
September 26, 2014, previously published on September 15, 2014The Ontario Superior Court of Justice recently certified a class action by dealers of a home furnishings company in 1291079 Ontario Limited v. Sears Canada Inc.
|Update on BC Franchise Legislation - BC Government Asks for Submissions from Stakeholders|
Jordanna Cytrynbaum, Helen Fotinos, Miriam Isman, Adam Ship; McCarthy Tétrault LLP;
September 26, 2014, previously published on September 15, 2014Earlier this year, the British Columbia Law Institute (BCLI) published a Report on a Franchise Act for British Columbia (the “BCLI Report”) and recommended the implementation of franchise disclosure legislation in B.C., similar in structure to the legislation in force in Ontario,...
|Understanding The Fundamentals of Franchise Law|
James G. Heldman; Strauss Troy Co., L.P.A.;
September 23, 2014, previously published on September 12, 2014Franchising is regulated by the Federal Trade Commission Franchise Rule ("FTC Franchise Rule") and by various state agencies. A state's franchise laws usually apply only if the offer or sale of a franchise is made in the state; or the franchised business will be located in the state, or...
|Will Petition Flow Through, Too? Texas Comptroller Seeks Review on Subcontractor Payments for Franchise Tax Purposes|
Stephanie T. Do, Timothy A. Gustafson; Sutherland Asbill & Brennan LLP;
September 4, 2014, previously published on August 28, 2014 The Texas Comptroller has filed a reply supporting its petition for review to the Texas Supreme Court in Titan Transp., LP v. Combs, 433 S.W.3d 625 (Tex. App. 3rd 2014). The taxpayer in Titan was in the business of hauling, delivering and depositing aggregate at construction sites, providing its...
|California About to Make Franchise Terminations Harder|
Michael A. Bowen, Roberta F. Howell; Foley & Lardner LLP;
September 1, 2014, previously published on August 28, 2014A bill on the verge of becoming law in California will sharply narrow the grounds for termination of franchises in that state, and may require re-examination of the terms of franchise agreements. Existing California law bars termination of franchises prior to expiration of their terms “except...