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Emerging Companies Insider

The Emerging Companies Insider blog focuses on recent and developing areas of the law affecting startup and emerging growth companies and their investors, including choice of entity, shareholders’ agreements, issuance of equity to employees, preparing for and executing a capital raise, exit strategies and the JOBS Act and its impact on how companies can and should raise capital from investors.

Franchise Law Update

For those with an interest in the world of franchising, the Franchise Law Update blog will become a regular stop for you. Our bloggers discuss not only the regulatory aspects of franchising, but also diverse topics such as business finance, employment, litigation and the protection of intellectual property including trademarks and copyrights. We understand that while franchising has its unique aspects, franchise businesses confront the same opportunities, changes and challenges as any other business.

Recent Blog Posts

  • Wait a Minute… Do You Have a Minute Book? Once you have made the decision to incorporate your business, and gone through the formation process, it can feel like your company is ready to take on the world. However, there is one important item that cannot be neglected: the minute book. A minute book is the living official record of a business and contains all of the important documents to reflect the business’ history. Copyright: mexrix / 123RF Stock Photo Maintaining organized records in a minute book is critical for any... More
  • Here’s What You Need to Know about British Columbia’s New Franchise Law Contributed by Judy Rost and Ryan Howe* On February 1, 2017, the Franchises Act S.B.C. 2015, c. 35 (the “Act”) came into force in the province of British Columbia, Canada. What this means for franchising in British Columbia: The most important implication for franchisors with operations in British Columbia (“BC”) will be the franchise disclosure requirements stipulated under section 5 of the Act, and as prescribed by the Franchises Regulation, B.C. Reg. 238/2016 (the “Regulation”). Much like the existing legislation in Ontario and... More
  • Franchise Industry Targets Millennials as Franchisees Commentators are writing a lot about integrating millennials into the business world.  A  recent article in QSR Magazine  brings this discussion to the franchise industry by urging franchisors to target millennials as the next generation of franchise business owners.  According to the article, millennials (those born between 1980 and 2000) spend more money in restaurants per capita than any previous generation and are the largest living generation in the United States.   Millennials have the potential to be innovative managers and franchisees but are selective about finding... More
  • Tribe and Matz Examine Technology and the Supreme Court at Wired Andrew Halbert writes: Copyright: mesutdogan / 123RF Stock Photo In a recent opinion column for Wired, Laurence H. Tribe and Joshua Matz took an interesting look at the Supreme Court’s views on emerging technology. Tribe, a professor of constitutional law at Harvard University, and Matz, a practicing attorney and former law clerk for Justice Kennedy, examined how those views have led to surprising alliances on particular cases that cannot be explained by the more traditional dichotomy of originalists versus those that view... More
  • First Time in over 20 Years: The DOJ and FTC Have Updated their Antitrust Guidelines for the Licensing of IP Contributed by Ted Jobes, Chair of Fox Rothschild’s Anti-Trust Practice Group 62267877 – a word cloud of brand licensing related items Updating policies that had been on the books for more than two decades, the U.S. Department of Justice and the Federal Trade Commission has issued new Antitrust Guidelines for the Licensing of Intellectual Property that replace guidelines issued by the same agencies in April 1995. Such guidelines state the antitrust enforcement policy of the agencies relating to the licensing of intellectual property protected... More
  • Court Relies on Intended Gross Sales in Denying Summary Judgment In determining whether an agency agreement between a family moving company, Ocean City Express, and an interstate moving company, Atlas Van Lines, is subject to the requirements of the New Jersey Franchise Practices Act (“NJFPA”), the federal district court in Newark (“Court”) held that a reasonable factfinder could conclude that this relationship falls within the requirements of the NJFPA in denying Atlas’ motion for summary judgment in Ocean City Express Co., Inc. v. Atlas Van Lines, Inc. Here, Ocean brought suit... More
  • Changes to Pennsylvania Business Entity Laws Pennsylvania legislation known as Act 170 (the “Act”), which went into effect earlier this week, represents a comprehensive revision to the existing laws of partnerships and limited liability companies.  The Act amends Pennsylvania law on corporations and unincorporated associations and adopts the Uniform Partnership Act, Uniform Limited Partnership Act and Uniform Limited Liability Company Act and is effective in two stages: On February 21, 2017 for all entities that file on or after February 21, 2017; and On April 1, 2017 for... More
  • Hold That Mail: Franchisor Granted Temporary Restraining Order to Enforce Non-Compete The interpretation and enforcement of non-competition covenants is always a hot button issue and varies from state to state. In Our Town v. Michael Rousseau and Jennifer Rousseau, the United States District Court for the Middle District of Pennsylvania (“Court”) granted a temporary restraining order filed by a franchisor, Our Town, against its former franchisees to prohibit them from operating a competing business in direct violation of the terms of the franchise agreement. Copyright: jossdiim / 123RF Stock Photo Here, on the... More
  • Are You Aware of the Recent Revisions to the SBA Loan Process for Franchised Businesses? Many franchisors have experience with the U.S. Small Business Association (“SBA”) as numerous franchisees utilize the SBA’s loan programs for small businesses. Previously, franchisors could send an application to the SBA to get on the Franchise Registry. During this process, the SBA reviewed the franchise agreement and drafted an addendum to revise the franchise agreement to avoid inclusion under the SBA’s “affiliation” rule (“SBA Negotiated Addendum”). This process was time-consuming and costly to all parties involved. On November 22, 2016, the SBA issued an... More
  • Boilerplate Isn’t Always Boilerplate Early stage companies are typically urged, and appropriately so, to ensure that their “charter documents,” specifically their certificate of incorporation and bylaws, are consistent with statutory requirements in their jurisdiction of organization, and reflect the short term and identifiable long-term objectives of the founding shareholders.  Many founders will search for “boilerplate” documents on the internet or other public sources, and as their enterprises grow, seek to modify those forms to cover such items as super-majority voting provisions, director removal provisions,... More
  • Amendments Make International Entrepreneur Rule More Startup-Friendly: Rule’s Future Remains Unclear The U.S. Citizenship and Immigration Services recently published the International Entrepreneur Rule (the “Rule”), which finalizes regulations intended to increase and enhance entrepreneurship, innovation and job creation in the U.S.  The Rule becomes effective on July 17, 2017.  In a prior blog, we analyzed the Rule when it was first proposed in August 2016.  Since then, the Rule has been through a period of public comment.  The resulting amendments generally make it easier for foreign entrepreneurs to establish startup companies... More
  • So You’re Looking to Exit – Why Must You Represent and Warrant? The goal of many entrepreneurs is to seek venture capital financing or ultimately sell their company in an “exit” merger or acquisition. In each case, the company’s historical operations come under onerous pressure through the representations and warranties the seller is asked to make, and the related due diligence the seller must produce. To a small business, this can be extremely uncomfortable and/or challenging. To a big business, it may be more comfortable but nonetheless more demanding. So why are they... More
  • Franchisor Not Joint Employer under Economic Reality Test In Gessele v. Jack in the Box, Inc., the franchise world got a win in the joint employer battle when the United States District Court for Oregon (“Court”) held that Jack in the Box, Inc. (“JIB”) was not the joint employer of certain employees of its franchisees as a matter of law using the economic reality test in granting summary judgment in JIB’s favor. Here, several employees brought a putative class action lawsuit against JIB for violation of the minimum-wage and... More
  • Fox Rothschild’s Franchise Group Continues Growth Copyright: bbbar / 123RF Stock Photo The attorneys of Fox Rothschild’s Franchising, Licensing & Distribution practice are excited to welcome associate Megan Center as she joins Fox’s franchise practice group.  Prior to joining Fox Rothschild, Megan spent four years at a well-recognized franchise boutique law firm in Philadelphia where she focused her practice on business transactions in the franchise context with an emphasis on state franchise registration and regulatory compliance.  Megan will work with the attorneys in the franchise practice group to provide general... More
  • Get a Head Start on Franchise Updating and Renewal Season! It is January and that means we are already counting down the days until the deadlines for updating your franchise disclosure document (FDD) and filing state franchise renewals are here.    Many franchisors’ fiscal year ended on December 31st.   The FTC gives a franchisor 120 days to update its franchise disclosure document (FDD) but some state deadlines many come much sooner.   Franchisors should already be gathering the information needed to update their FDD and file state renewal applications (if applicable).  Below are some quick tips... More