Understanding Franchise Litigation
To be on a safe side, you should be aware of the legal issues that might come up in a franchising business. Contact a lawyer before entering into a franchising agreement and make sure all the legal formalities are right.
Litigation in franchise usually falls into the following categories:
• Breach of contract • Fraud • Trademark and copyright infringement • Contact termination • Vicarious liability • Encroachment • Implied covenant of good faith and fair dealing claims • Transfer issues • Discrimination claims • Enforcement of system standards, • Antitrust • Registration and disclosure violations • Restrictive covenants • Consumer fraud • Product liability • Securities fraud
There are special lawyers who advise on legal disputes in franchising contracts. It could be better to consult them before entering into the contracts rather approaching them after falling into trouble. You can be well informed about all the legal complications that could arise if any. A legal advice will always keep you in a safer position. A legal understanding between the franchisor and the franchisee is also inevitable. This would help both the parties respect the legal formalities and function accordingly. You must be more careful in case of foreign franchisees that you undertake.