Law.com Subscribers SAVE 30%

Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.

Franchising: A Venus Flytrap for Trademark Licensors

By Rupert M. Barkoff
April 28, 2011

Your client gives you a call to let you know that his company just licensed its primary mark to a third party who will sell your client's products on the West Coast, including California and Arizona. Should you be happy for your client, or should a chill go up your spine? To answer these questions, you will need some additional factual information and a little knowledge about the laws of franchising. You (and your client) should be concerned that your client may unwittingly have just sold a franchise and become what is known in the franchise community as an “accidental franchisor.” Needless to say, this is not good news. Falling into this Venus Flytrap is easy to do, and can have severe negative consequences for your client.

Since the early 1970s, franchising has become a highly regulated means of distribution in two areas ' first, in the area of franchise sales; and second, in how the franchisor must behave once a franchise relationship has been established ' particularly in the areas of franchise terminations, non-renewals, franchise transfers, and in restricting franchisees in their rights to associate with other franchisees.

Read These Next
The DOJ's Corporate Enforcement Policy: One Year Later Image

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 Image

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 Image

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 Image

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.

A Lawyer's System for Active Reading Image

Active reading comprises many daily tasks lawyers engage in, including highlighting, annotating, note taking, comparing and searching texts. It demands more than flipping or turning pages.