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The Franchise Memorandum

Posts from November 2012 - Issue 161.
Posted in Class Actions

A federal court in California recently approved the settlement of a disability-access class action lawsuit in Vallabhapurapu v. Burger King Corp., 2012 U.S. Dist. LEXIS 154867 (N.D. Cal. Oct. 26, 2012). The settlement involved the second part of a class action originally asserted by ten plaintiffs against Burger King in Castaneda v. Burger King Corp., 2010 U.S. Dist. LEXIS 78299 (N.D. Cal. July 12, 2012), the settlement of which was reported in Issue 134 of The GPMemorandum. The approximately 86 plaintiffs in Vallabhapurapu contended that restaurants leased by Burger King to its ...

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In a case that could apply to all types of franchises, a former machinery distributor’s claims under the Maine Unfair Trade Practices Act (MUTPA) were dismissed last month in The Oliver Stores v. JCB, Inc., Bus. Franchise Guide (CCH) ¶ 14,913 (D. Maine Oct. 5, 2012). Defendant JBC brought a motion to dismiss the MUTPA claim on the grounds that the remedies of attorney’s fees and other relief under the MUTPA are not available when the parties had a commercial relationship such as a franchise or distributorship. In 1993, Maine’s legislature had amended the Maine Franchise Act to ...

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In an action brought by a hotel franchisor against a recently terminated franchisee, a New Jersey federal court dismissed without prejudice several fraud-based counterclaims asserted by the franchisee. In Wingate Inns International, Inc. v. Swindall, 2012 U.S. Dist. LEXIS 152608 (D.N.J. Oct. 23, 2012), the court rejected the franchisee’s claim that Wingate Inns had fraudulently induced her purchase of the franchise with personal assurances of profitability and support. The court noted that the franchise agreement contained integration clauses in which Swindall agreed ...

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Posted in Contracts

A Florida federal district court judge has enforced a forum selection clause set forth in a form franchise agreement attached to a Uniform Franchise Offering Circular even though neither party to the contract could produce a fully executed copy. Alloy Wheels, Inc. v. Wheel Repair Solutions Int’l, Inc., 2012 U.S. Dist. LEXIS 118600 (S.D. Fla. Aug. 21, 2012). The plaintiff franchisee alleged that it negotiated with the defendant franchisor, headquartered in Georgia, for a wheel repair franchise that included a specific, exclusive territory in South Florida. After the franchisee ...

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Posted in Retrospective

This is the sixth of our year-long series of articles reviewing the recent progeny of what we identified in December 2007 as the most significant franchise case decisions summarized in Issues 1 through 100 of The GPMemorandum. The sixth of those cases was Dunkin’ Donuts Inc. v. Priya Enterprises, Inc., 89 F. Supp. 2d 319 (E.D.N.Y. 2000), a case handled by current Gray Plant Mooty attorneys before they joined our firm. In Priya, Dunkin’ Donuts initiated a lawsuit seeking an injunction to compel Priya’s compliance with its health, safety, and sanitation standards, as required ...

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In Curves International, Inc. v. St. Paul Ungewitter, Inc., No. 62-cv-12-6568 (Minn. Dist. Ct. Oct. 17, 2012), Curves successfully enforced a one-year, ten-mile post-term noncompete agreement against a former franchisee whose franchise agreement had expired. (Gray Plant Mooty represented Curves.) The court found that Curves had met its burden of demonstrating that it would be irreparably harmed absent injunctive relief because the former franchisee had converted her Curves operation into a new women’s exercise/fitness facility using Curves equipment and serving ...

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Posted in Announcement

Sandy Bodeau recently joined Gray Plant Mooty’s Minneapolis office as a member of its Franchise & Distribution practice group and Franchise Mergers & Acquisitions team.

For more than 12 years, Bodeau has advised clients on a broad range of franchising and commercial issues. In addition to her law firm practice, her past experience includes in-house counsel work for a multi-concept retail franchisor, giving her firsthand experience with issues facing franchisors. Her current practice focuses on advising franchisors on system development and ongoing program issues, and ...

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Posted in Arbitration

In Ace Hardware Corp. v. Advanced Caregivers, LLC, 2012 U.S. Dist. LEXIS 150877 (N.D. Ill. Oct. 18, 2012), the United States District Court for the Northern District of Illinois granted franchisor Ace Hardware’s motion to compel arbitration of the fraud claims of the franchises, Advanced Caregivers. Advanced Caregivers had brought suit in federal court in Florida on behalf of itself and a putative nationwide class, alleging that Ace defrauded them in connection with their decision to acquire Ace franchises. The dispute arose after Ace requested that Advanced Caregivers sign a ...

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The Franchise Memorandum is a collection of postings on summaries of recent legal developments of interest to franchisors brought to you by Lathrop GPM LLP. 

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