The Franchise Memorandum

After denying a motion to dismiss, a federal court in New Jersey has now refused to grant summary judgment to a franchisor on racial discrimination and other employment-related claims asserted by its franchisee’s employee. Ward v. Cottman Transmission Sys., LLC, 2022 WL 909637 (D.N.J. Mar. 29, 2022).

A federal court in Illinois recently dismissed a franchisee employee’s Title VII hostile work environment and related Illinois state-law claims against the franchisor. Budzyn v. KFC Corp., 2022 WL 952746 (N.D. Ill., Mar. 30, 2022).

A federal court in Illinois denied Subway’s motion to dismiss a claim that it violated the Illinois Biometric Information Privacy Act (BIPA) by failing to obtain a franchisee’s employee’s consent for the collection and possession of the employee’s fingerprints. Ronquillo v. Doctor’s Assocs., LLC, 2022 WL 1016600 (N.D. Ill. Apr. 4, 2022).

A state court in Connecticut recently granted summary judgment to Days Inns Worldwide, Inc. in a slip and fall case. Lacertosa v. Days Inns Worldwide, Inc., 2022 WL 1051147 (Sup. Ct. Conn. Mar. 30, 2022).

A federal court in New York recently granted Yum! Brands’ motion to dismiss ADA and New York State Human Rights Law claims brought against it by a customer of a Kentucky Fried Chicken franchise. Zuchengno v. FQSR, LLC, 2022 WL 1214406 (W.D.N.Y. Apr. 25, 2022).

A federal court in Florida looked to the explicit terms of the agreements when a franchisee alleged that a franchisor’s failure to provide ongoing support and assistance was in breach of contract. Show Me Hospitality, LLC v. Tim Hortons USA, Inc., 2022 WL 1182896 (S.D. Fla. Apr. 21, 2022).

A Federal Court in Tennessee recently denied a franchisor’s motion for preliminary injunction and dissolved a temporary restraining order that had previously been put in place, because the franchisor could not demonstrate a likelihood of success on the merits of its claims, did not establish irreparable harm, and the customers of the defendant would be substantially harmed if the preliminary injunction were ordered. Freedom Franchise Sys., LLC v. CHOTO Boat Club LLC, 2022 WL 1206569 (E.D. Tenn. Apr. 21, 2022).

The Federal Circuit Court of Appeals recently reversed a district court’s ruling that dealership agreements were sufficient to establish jurisdiction over car manufacturers in a patent dispute. In re Volkswagen Grp. of Am., Inc., --- F.4th ---, 2022 WL 697526 (Fed. Cir. Mar. 9, 2022).

A federal court in Minnesota recently granted summary judgment to a manufacturer on all claims brought against it by its distributor, holding that optional equipment purchases cannot constitute a franchise fee under the Minnesota Franchise Act. Louis DeGidio, Inc. v. Indus. Combustion, Inc., 2021 WL 6127865 (D. Minn. Dec. 28, 2021).

A federal court in Missouri recently denied a medical device manufacturer’s motion for summary judgment on its distributor’s counterclaims for breach of contract and declaratory relief, finding factual disputes remained as to nearly every significant issue. MWG Enters., LLC v. ETS Wound Care, LLC, 2022 WL 503727 (E.D. Mo. Feb. 18, 2022).