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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

  • Enforcement is on the Menu: May 5, 2017 is the deadline to comply with menu labeling rules Copyright : Igor Yaruta Over two years ago, on December 1, 2014, the U.S. Food and Drug Administration (“FDA”) published a food labeling rule requiring “chain” restaurants and similar retail food establishments to list calorie information on menus and menu boards, including food on display and self-service food (the “Rule”). On May 5, 2017, the FDA will begin enforcing the Rule. Businesses covered by the Rule must be in compliance by May 5, 2017. The Rule implements the nutrition labeling provisions of the... More
  • Reverse Due Diligence – A Critical Analytical Tool for Emerging Tech Companies For investors and founders of emerging tech companies, leaving money on the table is a tragedy which can never be remedied once it occurs. An exit sale to or investment from a large strategic buyer is for many young tech companies a once-in-a-lifetime event with enormous economic consequences impacting both the company’s founders and investors. They must “get it right” with respect to the enterprise value of the emerging tech company. For reasons explained in a 2014 article by Fox Rothschild... More
  • SEC Releases New Compliance and Disclosure Interpretations on Regulation Crowdfunding Andrew Halbert writes: On April 5, the Division of Corporate Finance of the Securities and Exchange Commission released two new compliance and disclosure interpretations (“C&DIs”) regarding Regulation Crowdfunding.  Regulation Crowdfunding was adopted in 2015 in order to implement the provisions of Title III of the Jumpstart Our Business Startups (JOBS) Act of 2012 that exempt certain crowdfunding transactions from registration under the Securities Act of 1933. Copyright: yupiramos / 123RF Stock Photo The first new C&DI addresses the disclosure requirements of Rule 201,... More
  • What The 21st Century Cures Act Did For Regenerative Medicine Under Section 3033 of the 21st Century Cures Act, a drug is eligible for regenerative medicine advanced therapy (“RMAT”) designation. To obtain this designation, the treatment must be “a cell therapy, therapeutic tissue engineering product, or any combination product using such therapies or products, “intended to “treat, modify, reverse, or cure a serious or life-threatening disease” and have preliminary clinical evidence that the drug has the potential to address unmet needs. In its Guidance for Industry entitled “Expedited Programs for... More
  • Will Florida Cease to be the “Sunshine State” for Franchising? (Part 2/2) Today, we continue our look at proposed changes to Florida’s franchise laws, including proposed changes in transferring franchised businesses, franchisor repurchase obligations and other miscellaneous changes TRANSFERRING FRANCHISED BUSINESS The Act prohibits a franchisor from restricting a franchisee’s ability to transfer its franchised business if the franchisee complies with franchisor’s “reasonable” transfer conditions, and the potential purchaser meets the qualifications for new and renewing franchisees. The Act fails to define what a “reasonable” transfer condition would be. Further, a franchisor must make... More
  • Will Florida Cease to be the “Sunshine State” For Franchising? 1/2 Two state legislators from Florida recently introduced a bill entitled “Protect Florida Small Business Act” (the “Act”), which could actually have the exact opposite effect on franchise relationships in Florida. While many states regulate the franchisor-franchisee relationship through franchise registration and restrictions on termination and non-renewal rights, this proposed legislation would implement some of the most extensive regulations on the franchise relationship in the United States. APPLICABILITY First, the Act is not explicitly clear about what agreements and parties it applies to. The... More
  • Should Robots be Taxed for Performing Jobs Ordinarily Performed by Humans? Copyright: kjpargeter / 123RF Stock Photo A recent comment by Bill Gates that robots that take human jobs should “pay” taxes, or be taxed, has stirred debate in the artificial intelligence, economic and legal worlds. Numerous questions emerge from this debate, the most pertinent being who will actually be paying the tax. This may be solved by creating a legal entity for the robot to pay taxes, just as is done to tax corporations. Many innovators in the emerging companies sector believe... More
  • 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