Association Negotiation
Worked with franchisee association in renegotiating terms of franchise agreement for entire system, allowing for greater cooperation with franchisor.
What is a Breach of Contract?
A contract breach has occurred if the franchisor has done things that the agreement doesn’t allow, or if the franchisor has failed to do what it promised. For example, a breach may have occurred if the franchisor does any of the following:
- Burdens you with requirements that were not covered in the agreement you signed
- Changes the way it conducts business with you
- Fails to provide the training and support you were promised
An agreement between you and the franchisor doesn’t necessarily have to be in writing for a breach to occur. The franchisor might have made certain promises, or you and the franchisor might have carried on a certain kind of business relationship for a number of years, and now the franchisor is doing something different. In any case, a franchise law attorney can assess and investigate your case, and fight to protect your rights.
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Breach of Contract Difficulties and Successful Representation
Franchisees are often surprised to learn that franchisors have very few obligations under a franchise agreement. If you look at most “Franchisor Obligation” sections in franchise agreements you will notice that most of the obligations are not actual obligations; rather, they say things like “We will provide ongoing assistance, as we deem advisable in our sole discretion.” This means that many franchisees that think there has been an obvious breach of contract are mistaken. The analysis, however, does not necessarily end there and most states imply a ‘covenant of good faith and fair dealing’ into every contract. While this covenant generally does not alter the terms of an agreement, it can give franchisees legal leverage to achieve their objectives.
Despite these difficulties, we have worked with clients and achieved key objectives for them on a variety of breach of contract matters:
- We obtained for one client an award of several hundred thousand dollars because the franchisor’s method and equipment didn’t work.
- A group of franchisees explained to the firm how the franchisor had let them down in training and support, and the firm helped them leave the franchise system and operate as independent businesses.
- A franchise association complained that the franchisor was taking money from them in a breach of the franchise agreement. The firm won a test case based on a breach of franchise agreement, and all of the association members received refunds.
Results
Startup Helper
Assisted new brewery client to form business entity, comply with securities laws, register trademarks, and negotiate lease.
Selling a Cannabusiness
Litigated and helped resolve an internal shareholder dispute about ownership of a cannabis business.
Testimonial
Elliot Ginsburg has been representing my edibles business in Minnesota since it became legal to sell low-dose hemp edibles. He’s been wonderful to work with and I would highly recommend him to other cannabis businesses. He is quick to respond and will email cannabis law updates that he finds are pertinent to my business.
-Ranelle Kirchner