The Franchise Memorandum

A federal court in Virginia denied a franchisor’s motion for preliminary injunction against a former franchisee violating the franchise agreement’s post-termination noncompete. JTH Tax, LLC v. Younan, 2023 WL 6304865 (E.D. Va. Sept. 27, 2023).

The Eighth Circuit Court of Appeals has affirmed the denial of a motion to stay pending arbitration because the claims of the franchisor, Breadeaux’s Pisa, did not fall within the mandatory stay provision of the Federal Arbitration Act (FAA). Breadeaux’s Pisa, LLC v. Beckman Bros. Ltd., 2023 WL 6801149 (8th Cir. Oct. 16, 2023).

A federal court in Florida rejected a franchisee’s motion to vacate an arbitration award entered against it despite its arguments it did not have notice of the arbitration hearing. Your CBD Stores Franchising, LLC v. Buckwalter, 2023 WL 6676671 (M.D. Fla. Oct. 12, 2023).

A federal court in Tennessee recently granted a franchisor’s motion to compel arbitration, including as to questions of arbitrability, in response to a 15 count complaint brought by 54 separate franchisees. Anthony v. Van Over, 2023 WL 6317685 (E.D. Tenn. Sept. 27, 2023).

A federal court in New Jersey recently declined to issue an order invalidating the class action waiver and arbitration provision used by franchisor The UPS Store, Inc. and certain TUPSS franchisees’ (collectively, TUPSS) and it would not bar TUPSS from soliciting such waivers from their customers going forward. Tripicchio v. UPS Store, Inc., 2023 WL 6307528 (D.N.J. Sept. 28, 2023).

As franchisors implement and expand their DEI initiatives, each brand may undertake slightly different paths, or may focus resources in different ways to increase diversity throughout their systems. Franchise Times recently published an article describing some of these approaches, as well as challenges facing franchisors.