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Franchisor Prevails at Trial Despite Finding of Technical Disclosure Violation
A decision hot off the press of the United States District Court for the Southern District of Georgia, Massey, Inc. v. Moe’s Southwest Grill, LLC, No. 1:07-CV-0741, 2015 U.S. Dist. LEXIS 12281 (Feb. 3, 2015), has several lessons for franchisors. First, it demonstrates how franchisors can successfully avoid liability for technical disclosure violations by proving that franchisees actually benefitted because of the policy about which they complain. Second, it demonstrates that even when franchisees can make out a violation, franchisors can still prevail at trial. Third, it proves that careful drafting of a franchise disclosure document (FDD) by counsel experienced enough to anticipate changes in the business is critical to a young franchise system.
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Sick Time and Paid Leave Bills Proposed in Minnesota Legislature
Several bills regarding sick time and paid leave have been introduced to the Minnesota Legislature which, if passed, could have significant impact on Minnesota employers.
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Patents on Software and Business Methods – Still Possible but Challenging
In the past several months, it has been suggested that software and business methods can no longer be patented. Generalizations like this are often very easy to make, but the true analysis is typically more complex. This is especially true when examining the current state of law related to the patentability of software and business methods.
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Trade Dress: Another Way to Protect Websites
The law around trade dress is an offshoot of trademark law. While trademarks typically consist of words, phrases, or logos, trade dress relates to things like shapes, patterns, or the combination of features.
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New International Patent Protection Effective This Spring
Several years ago the United States adopted the Madrid Protocol, enabling firms in the U.S. to take advantage of international protection for their trademarks. This action enormously simplified the process for protecting trademarks on a worldwide basis, and dramatically reduced the cost of obtaining foreign protection.
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Federal Circuit Makes Two Significant Holdings Framing How Inter Partes Review Will Proceed
When introduced, the America Invents Act (“AIA”) provided revised mechanisms to challenge the validity of issued patents. These changes were intended to provide a more efficient and cost-effective method to deal with patent issues.
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State Regulators Circumvent Venue Clauses for Arbitration
Sawan Patel and Susan Tegt contributed the article, "State Regulators Circumvent Venue Clauses for Arbitration" to the Winter 2015 edition of The Franchise Lawyer.
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National Labor Relations Board Update
The National Labor Relations Board (NLRB) recently published a decision affecting the right of employees to use an employer’s e-mail system to discuss wages, hours and working conditions, and issued a new rule accelerating the time period for an election when a labor union has filed a representation petition.
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Tax Extender Law and ABLE Act Help Individual Taxpayers
On Friday, December 19, 2014, President Obama signed the Tax Increase Prevention Act of 2014 and the Achieving a Better Life Experience Act of 2014 (“ABLE Act”).
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More Special Assessments on the Horizon as Cities Contemplate Public Transportation Projects – Rights to Bear in Mind When Ordered to Pay a Special Assessment
Business owners along University Avenue in St. Paul have recently received notice of proposed special assessments from the city related to construction of the central corridor light rail (the “Green Line”). A number of these owners have been ordered to pay thousands of dollars, even though they have had to struggle with a multitude of issues and challenges stemming from the light rail project, including limited parking and sidewalk blockages from snow.
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Minnesota Court of Appeals Decision Expands Insurance Coverage for Commercial Lenders
Commerce Bank v. West Bend Mutual Insurance Co., 853 N.W.2d 836 (Minn. App. 2014)
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This recent Court of Appeals decision expands insurance coverage for commercial lenders in Minnesota by ruling that vacancy cannot void a lender’s coverage under a “standard” mortgage clause. Commercial property casualty insurance policies do not insure against losses stemming from vandalism, sprinkler leakage, glass breakage, water damage, theft or attempted theft if the property has been vacant for more than 60 days. Vacancy (defined specifically in the policy) means less than 31% use and occupancy. As a result of this decision, these vacancy clauses that void coverage apply only to owners, and not their lenders. -
Mistakes Happen. To Head Them Off, Training Program for Sales Team is a Must
Chuck Modell's article, "Mistakes happen. To head them off, training program for sales is a must," was published in the November/December 2014 edition of Franchise Times magazine.
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How Many FDDs Do I Need? New Rules on Disclosing Multi-Unit Franchising Arrangements
On September 16, 2014, the North American Securities Administrators Association (“NASAA”) adopted the Multi-Unit Commentary (the “Commentary”) that provides guidance on how multi-unit franchise arrangements are to be disclosed in Franchise Disclosure Documents (“FDDs”). Multi-unit franchise arrangements are known by a myriad of names—including area development, subfranchising, and area representation—but the new guidance is crystal clear: if you are a franchisor with multi-unit franchise arrangements, you will have additional work to do in your next franchise renewal cycle, and may actually have to create multiple versions of your FDD and filings in the registration states.
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Non-Signatory Owner-Operator Bound to Franchise Agreement
Earlier this month, in Everett v. Paul Davis Restoration, Inc., Nos. 12-3407, 13-1036, 2014 U.S. App. LEXIS 21059 (7th Cir. Nov. 3, 2014), the United States Court of Appeals for the Seventh Circuit held that an owner-operator of a property damage restoration services franchise was bound to the terms of a franchise agreement she had never executed because she received a direct benefit from the franchise agreement. Everett follows the trend in other jurisdictions to bind non-signatories to contractual provisions under the doctrine of equitable estoppel.
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It’s Time Again to Restate Your Retirement Plans, According to the IRS
Every six years, employers are required to restate their retirement plans. This includes 401(k) plans and all other qualified plans. (Plans that are “individually drafted” need to be restated every five years and are on a different schedule.) The deadline for completing this process is April 30, 2016, but as a practical matter, companies need to start the process soon.
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Insurance Coverage for Punitive Damages
The article, “Insurance Coverage for Punitive Damages,” surveys the various states’ laws on coverage for punitive damages and addresses issues to consider that may affect whether coverage is found under a policy. Specifically, the choice of law analysis that is applied by a state could make a difference on whether a court will allow or deny coverage for what can be very significant damages.
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New “Responsible Contractor” Requirements in Minnesota
Earlier this year, Governor Mark Dayton signed a controversial new bill into law which is known as the “Responsible Contractor” law. The Responsible Contractor law, which purports to “enhance accountability and transparency” in the procurement of public construction contracts, will impose onerous certification requirements upon contractors who bid on those contracts.
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Employees in California Entitled to Paid Sick Leave in 2015
Under the Healthy Families, Healthy Workplaces Act of 2014, California joined Connecticut as one of two states that require employers to give employees paid sick leave. The California statute will take effect July 1, 2015, and applies to employers that have one or more employees in California. Those employees will be entitled to take up to six days of paid sick leave for personal and family members’ medical reasons.
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Five Things You Need to Know About Trademark Disputes in China
1) Even if you aren’t selling in China, you may need to register your trademark
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Some companies have chosen not to register their trademarks in China, on the assumption that it is unnecessary if they don’t plan to sell their products in the Chinese marketplace, even though their products are manufactured in China. These same companies have been caught flat-footed when their products are manufactured in China for export and resale elsewhere. -
A Knowing Glance… Worthy of Copyright?
The 9th Circuit Court of Appeals, which includes California, is famous for being vigilant when it comes to Silicon Valley and Hollywood. The Court is often in the vanguard about issues involving intellectual property rights. That’s why the February 2014, decision in Garcia v. Google has shaken the movie industry to its core.
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