-
Washington State Investigating Use of No-Poaching Provisions in Franchise Agreements
The State of Washington has started issuing Civil Investigative Demands (“CIDs”), requiring franchisors to provide information on their use of no-poaching provisions in Franchise Agreements. By the end of this year, if not sooner, all franchisors offering franchises in Washington, or having franchisees in Washington, should expect to receive a CID.
Read MoreRead More - Washington State Investigating Use of No-Poaching Provisions in Franchise Agreements -
Does Your Square Peg Not Fit into a Round Hole? Consider the Discretionary Exemption
Compliance with state franchise registration and disclosure laws can be expensive and time consuming. As such, putative franchisors and franchisors alike often seek to identify an exemption or exclusion from the applicable law in hopes of being able to avoid the registration and disclosure provisions of the law. Unfortunately, sometimes the proposed franchisor or franchise transaction does not fit into a typical exemption, or the state lacks an applicable exemption. But one exemption, often trailing at or near the bottom of a state’s list of exemptions—and often overlooked—is the so-called “discretionary exemption,” an exemption in the public interest, or exemption by order or rule.
Read MoreRead More - Does Your Square Peg Not Fit into a Round Hole? Consider the Discretionary Exemption Download PDF -
SBA Makes it Easier For Franchisees to Obtain Financing
The Small Business Administration (SBA) has simplified the SBA loan process for franchisees, effective Jan. 1, 2018.
Read MoreRead More - SBA Makes it Easier For Franchisees to Obtain Financing -
NASAA Adopts New Rules on Financial Performance Representations
On May 8, 2017, the North American Securities Administrators Association, Inc. (“NASAA”) formally issued new guidance, the NASAA FPR Commentary (the “Commentary”), to clarify what constitutes a reasonable basis in making a financial performance representation (“FPR”)—with specific guidance for a variety of common FPRs that are made in Item 19 of Franchise Disclosure Documents (“FDDs”). The Commentary provides welcome guidance to franchisors that have been reluctant to include FPRs in their FDDs, or whose efforts to include FPRs have been rebuffed by state franchise examiners, but it will ultimately require all franchisors that currently include an FPR in their FDD to revise their FPR.
Read MoreRead More - NASAA Adopts New Rules on Financial Performance Representations -
Exemptions and Exclusions Under Federal and State Franchise Laws
Sawan Patel co-authored the Minnesota chapter in the American Bar Association’s book on franchise registration and disclosure exemptions, “Exemptions and Exclusions Under Federal and State Franchise Laws,” published in 2017.
Read MoreRead More - Exemptions and Exclusions Under Federal and State Franchise Laws -
SBA Announces Valentine’s Day Changes to SBA Loan Program for Franchises
Yesterday afternoon, the U.S. Small Business Administration (SBA) announced temporary changes to the recently revised franchise review process for its 7(a) and 504 loan programs. The changes are intended to facilitate SBA loans for franchisees of franchise systems who have previously been on the SBA’s Franchise Registry or otherwise negotiated an SBA Addendum to their franchise agreements.
Read MoreRead More - SBA Announces Valentine’s Day Changes to SBA Loan Program for Franchises -
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.
Read MoreRead More - State Regulators Circumvent Venue Clauses for Arbitration -
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.
Read MoreRead More - How Many FDDs Do I Need? New Rules on Disclosing Multi-Unit Franchising Arrangements -
Franchising Without Spamming Under Canada’s Anti-Spam Legislation
Canada’s Anti-Spam Legislation, S.C. 2010, c. 23 (Can.), and the regulations promulgated thereunder (“CASL”), is poised to become one of the toughest anti-spam laws in the world when it comes into force on July 1, 2014. And you do not need to be a spammer or even located in Canada to fall under CASL. In fact, CASL will complicate the relationship and marketing and communication strategies between franchisors located outside of Canada and their potential franchisees or customers. Beginning July 1, 2014, no commercial electronic message (“CEM”) may be sent from or received in Canada unless the sender of that message has received either express or implied consent from the recipient (whether an individual or entity), or the CEM is otherwise exempt under CASL. The new law applies to virtually any company that sends any electronic message that, based on the content of the message, has a commercial purpose. The primary difference between the United States’ CAN-SPAM Act and CASL is that the former requires an opt-out procedure for the recipient (e.g., an “unsubscribe” link in a commercial message) whereas the latter requires the recipient opt-in before receiving the message. This article summarizes the scope of CASL, the stiff penalties for non-compliance, and suggestions for complying with CASL.
Read MoreRead More - Franchising Without Spamming Under Canada’s Anti-Spam Legislation -
New Arbitration Appellate Procedures Change Playing Field
In the April 2014 issue of the Law Journal Newsletter's – Franchising Business & Law Alert,® Chuck Modell and Sawn Patel co-authored the article, New Arbitration Appellate Procedures Change Playing Field.
Read MoreRead More - New Arbitration Appellate Procedures Change Playing Field -
Forum Selection Clauses Used in Franchise Agreements Should Be Given More Deference
Courts should be more likely to uphold forum selection clauses following a recent U.S. Supreme Court ruling. Forum selection clauses are used in almost all agreements, including franchise agreements, to provide that any litigation between the parties to the agreement be brought and adjudicated in only certain listed state or federal courts. Franchisors rely on forum selection clauses to funnel litigation to only selected courts (usually in their home state) rather than having to “put out fires” across the country. Franchisors should revisit their forum selection and choice of law clauses to ensure they are valid and provide for the most favorable venue and governing law for the franchisor because courts are now more likely to uphold such clauses as written.
Read MoreRead More - Forum Selection Clauses Used in Franchise Agreements Should Be Given More Deference -
Compliance Best Practices with Foreign Corrupt Practices Act
On November 14, 2012, the U.S. Department of Justice (“DOJ”) and the U.S. Securities and Exchange Commission (“SEC”) issued joint guidance on the Foreign Corrupt Practices Act (“FCPA”). In general, the FCPA prohibits offering to pay, paying, promising to pay, or authorizing the payment of money or anything of value to a foreign official in order to influence any act or decision of the foreign official in his or her official capacity or to secure any other improper advantage in order to obtain or retain business. This article summarizes the "FCPA: A Resource Guide to the U.S. Foreign Corrupt Practices Act" that includes the new recommendations on effective compliance programs that businesses should adopt to detect and prevent FCPA violations.
Read MoreRead More - Compliance Best Practices with Foreign Corrupt Practices Act -
Read and Recycle: New FTC Regulations on Environmental Marketing Claims
On October 1, 2012, the Federal Trade Commission (“FTC”) issued its “Guides for the Use of Environmental Marketing Claims,” (“Guide”) which directs advertisers and marketers on the proper use of “green” or environmental claims in the sale or promotion of their products, services, or brand. Marketers need to be aware of these new guidelines before they make green or environmental claims (such as “100% RECYCLABLE MATERIAL,” “GREEN,” or “ECO-FRIENDLY”).
Read MoreRead More - Read and Recycle: New FTC Regulations on Environmental Marketing Claims
Showing articles for Sawan S Patel
Showing Results 1 - 13 of 13
Showing Results 1 - 13 of 13