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Posts in Discrimination.
Posted in Discrimination

In another decision, the Sixth Circuit again affirmed summary judgment in favor of a manufacturer, this time on a dealer’s claims that the manufacturer improperly terminated its distribution agreement. B & S Transp., Inc. v. Bridgestone Ams. Tire Operation, LLC, 2019 WL 581565 (6th Cir. Feb. 13, 2019). The claims arose after Bridgestone terminated its dealership agreement with B & S Transportation, an African-American owned and operated dealer of Firestone tires. The dealership agreement allowed B & S to pursue minority set-aside businesses and, as a result, had unique terms ...

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Posted in Discrimination

In Andy Mohr Truck Center, Inc. v. Volvo Trucks North America, 2017 WL 3695355 (7th Cir. Aug. 28, 2017), the United States Court of Appeals for the Seventh Circuit reversed an Indiana district court’s denial of Volvo Trucks of North America’s motion for judgment as a matter law, finding that Volvo did not unfairly discriminate against its dealer, Mohr Truck Center, in violation of the Indiana Deceptive Franchise Practices Act (“IDFPA”) and overturning a jury’s finding of discrimination and a $6.5 million damages award. In support of its unfair discrimination claim, Mohr ...

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Posted in Discrimination

The United States District Court for the District of Indiana ruled on several motions in limine related to franchisee's claims under the Indiana Deceptive Franchise Practices Act ("IDFPA") in Andy Mohr Truck Center, Inc. v. Volvo Trucks, 2015 U.S. Dist. LEXIS 93817 (S.D. Ind. July 20, 2015), and declined to bar the plaintiff franchisee from presenting evidence showing concessions offered to franchisees in other states. The court was not persuaded by Volvo's argument that the IDFPA is properly construed as applying only to discrimination among Indiana franchisees. The plain ...

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Posted in Discrimination

In Hardee’s Food Systems, Inc. v. Hallbeck, 2011 U.S. Dist. LEXIS 127169 (E.D. Mo. Nov. 3, 2011), the court granted Hardee’s motion to dismiss allegations by a group of its franchisees of breach of the implied covenant of good faith and fair dealing. (Gray Plant Mooty represented the franchisor in this case.) The franchisees alleged that Hardee’s had treated them differently from other Hardee’s franchisees by (a) failing to allow a reduction in license fees, (b) failing to provide advertising support, and (c) not allowing the complaining franchisees to close their ...

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Posted in Discrimination

In Santiago-Sepulveda v. Esso Standard Oil Co., Inc., 2011 U.S. App. LEXIS 8478 (1st Cir. Apr. 26, 2011), the First Circuit affirmed a lower court’s decision in favor of franchisors Esso and Total Petroleum. Esso withdrew from the Puerto Rico market and sold its assets to Total. Total offered existing Esso franchisees its current form franchise agreements. Unhappy with those agreements, Esso franchisees sued for an injunction to prevent Esso from moving forward with the sale. They also argued that the terms offered by Total were not in good faith and discriminatory under the ...

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Posted in Discrimination

In Halloum v. DFO, Inc., 2010 Cal. App. Unpub. Lexis 2558 (Cal. Ct. App. Apr. 8, 2010), a California Court of Appeal considered various claims by a franchise applicant against DFO, Inc., the franchisor for Denny’s restaurants, including claims of unlawful race and national origin discrimination. The plaintiff, a Palestinian Arab, claimed Denny’s was motivated to deny his franchise application by his race and ethnicity following the events of September 11, 2001.  The court first affirmed the trial court’s dismissal of claims for breach of an oral contract, promissory ...

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Posted in Discrimination

The United States District Court for the Southern District of New York issued an opinion late last month in DiPilato v. 7-Eleven, Inc., 2009 WL 2633130 (S.D.N.Y. Aug. 25, 2009), that serves as an important reminder that franchisors should maintain independent contractor relationships with franchisees. The plaintiff was a 43-year-old unmarried female applicant who was denied a 7-Eleven franchise after allegedly being told by a franchise sales employee that a single female over the age of 40 would not be a suitable franchisee. DiPilato sued 7-Eleven and several of its employees for ...

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Posted in Discrimination

In Elbanna v. Captain D’s, LLC, 2009 WL 435051 (M.D. Fla. Feb. 17, 2009), a prospective franchisee brought suit against a franchisor, alleging he was rejected from the system because he was Arab, and also claiming Captain D’s defamed him throughout the application process. Elbanna had been operating several Shoney’s franchises when he approached Captain D’s about opening one of its restaurants. Although his application was initially approved, the parties were unable to agree on a location. Two years later, Elbanna again approached Captain D’s about buying several ...

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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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