Franchise Law Update Blog

https://franchiselaw.foxrothschild.com/

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

  • 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 in 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 corporate and... 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
  • Supreme Court Agrees to Review Validity of Class Action Waivers in Arbitration Agreements Last week, the Supreme Court granted petitions for certioriari in Epic Systems Corp. v. Lewis, Ernst & Young v. Morris, and NLRB v. Murphy Oil USA.  All three cases involve clauses in arbitration agreements that require employees to waive their rights to pursue class and collective actions. In theory, the Supreme Court will resolve a split between federal circuits and determine if employees can be compelled to litigate claims individually rather than in a class or collective action. However, because Justice Scalia’s seat remains... More
  • Watch Manufacturer Avoids “Franchise” Designation The question of whether a relationship between a watch manufacturer, Swatch, and a watch shop operator amounts to a “franchise” was answered in the negative by the U.S. Court of Appeals for the Third Circuit in Philadelphia in Orologio v. Swatch Group (U.S.) Inc. Here, after Swatch terminated its relationship with the operator, the operator brought suit against Swatch under the New Jersey Franchise Practices Act (“NJFPA”) claiming that Swatch’s termination of the relationship violated the NJFPA for termination of... More
  • PA Supreme Court Affirms Franchisors Do Not Employ their Franchisees’ Employees Is a franchisor liable as a “statutory employer” under Pennsylvania law if its franchisee fails to obtain workers’ compensation insurance?  The Pennsylvania Supreme Court recently answered “no” under the facts of Saladworks, LLC v. W.C.A.B. (Gaudioso). The decision is a victory for franchisor Saladworks on a narrow legal issue.  But it is a bigger win for the franchise model itself, which relies on the premise that a franchisor is not the employer of its franchisee’s employees. Copyright: halfpoint / 123RF Stock Photo In... More
  • Coming Attractions: Can You Surcharge? A very important case for the retail industry–and all franchisors and franchisees operating within it–will be argued before the United States Supreme Court on January 10, 2017. The case is Expressions Hair Design v. Schneiderman. The issue is credit card surcharges. The background is pretty simple. New York, nine other states, and Puerto Rico prohibit retailers from engaging in the practice of charging a surcharge when a customer uses a credit card. Importantly, the ten states involved are some of the... More
  • State Regulators Strike Back: Franchisees Reclassified as Employees While the changes coming to Our Nation’s Capital in 2017 likely mean the end of the fight over reclassifying franchisees as employees at the federal government level, a recent New York state case suggests that the battle will remain alive and well at the state level. The case, In re Baez, was decided by the New York Supreme Court, Appellate Division. The question presented by the case was whether the franchisor, Jani-Pro Cleaning  Systems (“Jani-Pro”) was the employer of two independent... More
  • Baring a Last Minute Reversal, Philly Soda Tax Coming on New Year’s Day Copyright: grahammoore999 / 123RF Stock Photo Following up on our blog posts on March 29 and July 7 of 2016 about the Philadelphia Beverage Tax on Sugar-Sweetened Beverages (the “PBT”), a challenge to that tax in the Court of Common Pleas of Philadelphia County has been defeated in a decision by Judge Glazer on December 19. The plaintiffs included beverage distributors, the American Beverage Association, the Pennsylvania Beverage Association, the Philadelphia Beverage Association and the Pennsylvania Food Merchants Association. The court... More
  • Are You Prepared? Major Changes Coming to U.S. Copyright Database Contributed by Mark G. McCreary & Kevin P. Dermody One of the major benefits of the Digital Millennium Copyright Act (DMCA) is that website owners can gain the protection of the DMCA’s safe harbor provisions by registering a DMCA agent with the U.S. Copyright Office. The safe harbor allows a copyright holder to notify a website operator that its protected material was uploaded to the website and is being infringed. That website owner can avoid liability by removing the copyright-infringing material from... More