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Franchising: Once You Start, Can You Stop?
If a company ceases to expand its brand and market penetration through the sale of franchises as part of a plan to convert to an employee-based operation, is it exposed to liability for breach of the implied covenant of good faith and fair dealing? The answer is yes, according to one California appellate court. In Sherman v. Master Protection Corp., 2002 WL 31854905 (Cal. App. 6 Dist. Dec. 18, 2002)(rev. den. April 9, 2003) [Business Franchise Guide (CCH) '12,503], a non-published decision, a unanimous three-judge panel of the California Court of Appeal for the Sixth District recently awarded damages and legal fees to a franchisee on that very basis.
In Sherman, the defendant, Master Protection Corporation (MPC), used the brand name 'FireMaster' to market and service fire protection equipment. The plaintiff, Michael Sherman, purchased franchises from MPC in 1987 and 1991 for the sums of $40,000 and $60,000, respectively. He paid nothing down; the purchase price for each franchise was set by the franchisor and based on the gross sales for the previous year; the entire price was paid for by promissory notes of Sherman to MPC.
The DOJ's Corporate Enforcement Policy: One Year Later
The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.
The DOJ's New Parameters for Evaluating Corporate Compliance Programs
The parameters set forth in the DOJ's memorandum have implications not only for the government's evaluation of compliance programs in the context of criminal charging decisions, but also for how defense counsel structure their conference-room advocacy seeking declinations or lesser sanctions in both criminal and civil investigations.
Use of Deferred Prosecution Agreements In White Collar Investigations
This article discusses the practical and policy reasons for the use of DPAs and NPAs in white-collar criminal investigations, and considers the NDAA's new reporting provision and its relationship with other efforts to enhance transparency in DOJ decision-making.
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
Compliance Officers: Recent Regulatory Guidance and Enforcement Actions and Mitigating the Risk of Personal Liability
This article explores legal developments over the past year that may impact compliance officer personal liability.