Franchising

 

Franchising

While franchising has been developed as a distinct business model, each franchise business and the owners behind them are entirely unique. If you’re interested in exploring a franchise opportunity, as a franchisor or franchisee, we can offer you something unique, too. Co-founding attorney Catherine Riesterer, a former Assistant General Counsel for the Domino’s Corporation’s International Division, leads our franchising practice. Having worked with one of the most thriving and lucrative franchising organizations in the world, the invaluable experience and insight she gained, now benefits the clients we represent in franchising concerns throughout the world.

The potential for rewards in operating a franchise looms as large as the potential for disaster. In order to protect yourself, and your business, you need an attorney who is not only skilled in general business law, but an attorney who is knowledgeable in the specialized area of franchise law, including the close regulation of the federal government and, increasingly, state governments. The experience we offer our clients in the special requirements of franchises is exceptional.

We handle franchise needs worldwide including:

  • Franchise agreement review
  • Commercial lease agreement review
  • Franchising Disclosure Documents (FDD’s) and other disclosure document preparation
  • Franchise registration with state regulatory agencies
    trademarks
  • Trade secrets
  • Compliance with state and federal laws and regulations
  • Employment law matters
  • Civil litigation and appeals

Franchisors

Franchising Your Business System

Franchising is an exciting and rewarding way to do business. In many instances, franchising is also the fastest, least capital-intensive way to expand your business and the system and brand that you’ve mastered. There is, however, a lot that goes into launching a new franchise system. More than one might expect. Whether you are in the early stages of considering franchising your business or you have a detailed plan to franchise with a duplicable system already developed, we can walk you through the critical questions and decisions to developing a franchise. We will counsel you in developing and refining your franchise system so that it not only complies with the various state and federal franchise laws and regulations, but is also poised to succeed from a practical business perspective.

State Registrations and Renewals:

Spring is a season of new life and excitement, but for many franchisors, it’s a time of trepidation and chaos: franchise renewal season! The process of registering and renewing registrations to sell franchises can be fraught with frustration and delay. At Cooper & Riesterer, we guide franchisors through the regulatory minefield to register and renew your Franchise Disclosure Document to sell franchises in the regulated states. Cooper & Riesterer assists franchisors at all levels of sophistication, from those with designated in-house staff that have periodic questions to franchisors that prefer we handle the entire registration and renewal process. Our goal, as always, is to provide value-added services to your business. 

Franchise Law Compliance and General Counsel:

Franchising is business on steroids. The diversity and uniqueness of issues that franchise systems face on a daily basis makes access to responsive, effective, and business-savvy advice a necessity. Cooper & Riesterer prides itself on providing timely guidance and counsel to franchisors on a continual basis. Franchisor clients of Cooper & Riesterer are equipped in their business decision-making with a thorough understanding of the risks and opportunities associated with the decisions they face. Cooper & Riesterer also trains and assists franchisors in documenting and memorializing important transactions and events of their franchise system.

Dealing with Franchisees in Trouble:

Franchisees are the heart of a franchise system. Nevertheless, franchisors spend an inordinate amount of time and energy on a select few “special” franchisees – the franchisees that just cannot seem to abide by system rules or make their franchise work. Whether dealing with franchisee issues is a rare or daily occurrence, Cooper & Riesterer provides experienced counsel on proceeding with franchisees in an effective, legally sound manner. While the baseline for dealing with difficult franchisees is best handled at the outset via a well-drafted and regularly-reviewed franchise agreement, a franchisor’s established policies, and prompt attention to franchisee issues can save time, money, and reputation for the franchisor and the franchise system. Cooper & Riesterer assists franchisors in resolving franchisee issues and in implementing the policies and procedures that allow franchisors to consistently manage their own franchisee issues.

Franchisees

Purchasing a Franchise:

Not all franchises are created equal. When comparing franchises, most prospective franchisees see the similarities – same look, same choices, it’s all the same, right?

We know differently. At Cooper & Riesterer, we know that no matter how alike franchises are, franchise contracts, and especially the franchise owners and operators behind them, can be very different.

The decision to invest in a franchise can be daunting. At Cooper & Riesterer, we take the time to assist you in understanding the opportunities and pitfalls of operating a franchise generally and the specific strengths and concerns of the franchise system or systems you are investigating.

Franchise Document Review:

When you consider joining a franchise, you will be provided a large document, called a Franchise Disclosure Document or FDD, which provides a volume of information about the franchise system, your franchise (should you choose to purchase it), and the franchisor. The FDD also contains a form Franchise Agreement that you will sign if you become a franchisee – this is the document that governs your relationship with the franchisor.

Franchise Review Package:

Cooper & Riesterer offers a Franchise Review Package, which includes a complete review of the FDD and Franchise Agreement. We provide comments and feedback on the document and ensure that the franchisor’s business entity is in good standing in its home state. We also confirm that it maintains the appropriate trademark protections that it claims in the FDD.

After review of the FDD and Franchise Agreement, we arrange for an in-person or telephone meeting with you to discuss our review. If you are new to franchising, we will provide a brief summary of franchising and what to expect from a legal perspective in the FDD and Franchise Agreement, as well as areas of concern in the documents.

We then review our findings and point out important provisions, as well as areas of concern in the FDD and FA.  We will bring attention to areas in the FA or FDD that may need to be addressed with the franchisor.  It is best if you have had a chance to review our comments on the documents prior to our conversation.  During this conversation, we will address any questions you may have regarding the documents.

For many clients, this review is sufficient to permit them to make a decision to pursue the franchise opportunity or move on. However, if, based on our conversations, you want us to propose changes to the Franchise Agreement on your behalf, we will do so. We will also assist in any follow-up negotiation and guidance requested.

Breach of Contract by My Franchisor:

Just as you must abide by the terms of your Franchise Agreement, so must your franchisor. Franchisors sometimes unwittingly breach their franchise agreements or may innocently disagree with franchisees on the requirements of their franchise agreements. Other times, franchisors may knowingly breach franchise agreements, taking the bet that franchisees will not notice or will be unwilling or unable to challenge the franchisor.

We have assisted scores of franchisees facing a breach of their Franchise Agreement by their franchisor. More often than not the matters are resolved without necessitating litigation. When they are not, however, Cooper & Riesterer will pursue legal recourse through the courts to enforce your rights under your Franchise Agreement.

If you are aware or suspect that your franchisor has breached your Franchise Agreement, contact us immediately. Waiting too long can often jeopardize your ability to force the franchisor to correct its actions and make you whole for its breach.

Termination/Non-renewal of My Franchise:

You’ve just received a Notice of Termination or Notice of Nonrenewal of your franchise. You’ve spent months or years building your business and invested thousands of dollars into it, and now your franchisor is threatening to shut your business down.

Sometimes franchisors may have a good reason to send the Notice, and sometimes not. In both cases, Cooper & Riesterer provides counsel on the franchisor’s actions and representation responding to the franchisor.

There are a myriad of laws – state, federal, and court case law – that determine whether a franchisor may terminate a franchisee under certain circumstances and conditions. The attorneys at Cooper & Riesterer will analyze the alleged basis for termination and advise you of their veracity and your options.

When a franchisor takes such actions without an appropriate basis, Cooper & Riesterer will represent your interests to ensure your rights are protected. While litigation is best avoided, when it becomes necessary, we will file and defend against litigation relating to your rights to operate and/or renew your franchise.

When litigation may not make sense, or if the franchisor’s basis for termination is well-founded, we can assist in obtaining a workable resolution for you, whether by the sale of your business to the franchisor or a third party or otherwise. We will ensure that you are protected to the full extent of the law.

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