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Observations on Negotiating Franchise Agreements in Today's Legal Environment
Franchise law has long characterized franchise agreements as adhesion contracts (see, Ticknor v. Choice Hotels Int'l, 265 F.3d 931 (9th Cir. 2001) (Montana law); Bolter v. Superior Court, 87 Cal. App. 4th 900 (2001) (California law)). While no empirical data exist on the percentage of franchisors that will negotiate the terms of their franchise contract with prospective franchisees, it is fair to conclude that they remain a minority. To start the pre-sale disclosure process, a franchisor must present a prospect with the terms of its bona fide offer for the sale of a franchise. Frequently, these are the only terms the franchisor is prepared to accept.
Franchisors resist prospective franchisee efforts to negotiate better terms for themselves for any number of reasons. Some franchisors have no incentive to negotiate: Enough prospects are ready to buy a franchise on the franchisor's economic terms. Some franchisors offer their franchises on a strict 'take-it-or-leave-it' basis to avoid the administrative burden of managing a network of diverse contracts. Other franchisors eschew negotiating to avoid the possible fallout from charges of favoritism or to simplify the paperwork burdens associated with franchise sales. Some franchisors hide behind the extra disclosure duties that arise from contract negotiations by perpetuating the impression that franchise laws forbid franchisors from negotiating changes to their standard deal, which, of course, is untrue. Franchise laws do not forbid franchisors to negotiate franchise agreements, and franchise regulators do not intend for pre-sale disclosure rules to discourage contract negotiations. Nevertheless, the prevailing public perception is that franchise agreements are non-negotiable (see, for example, http://franchises.about.com/od/franchisinglegalissues/f/Fran_negotiate.htm, as of Dec. 10, 2006).
Why So Many Great Lawyers Stink at Business Development and What Law Firms Are Doing About It
Why is it that those who are best skilled at advocating for others are ill-equipped at advocating for their own skills and what to do about it?
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.
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.
A Lawyer's System for Active Reading
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.
Protecting Innovation in the Cyber World from Patent Trolls
With trillions of dollars to keep watch over, the last thing we need is the distraction of costly litigation brought on by patent assertion entities (PAEs or "patent trolls"), companies that don't make any products but instead seek royalties by asserting their patents against those who do make products.