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Court Watch
Franchise Owner-Operator Bound to Franchise Agreement As a Non-Signatory
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 a franchise agreement that she did not execute because she received a direct benefit from the franchise agreement. Everett is just one of many cases finding that a non-signatory to a contract may be bound by its terms under various theories ' in this case, direct benefits estoppel.
In Everett, the franchisor entered into a franchise agreement with Matthew Everett and EA Green Bay, LLC (EAGB). At the time the franchise agreement was executed, EAGB was owned, controlled, and operated by Matthew Everett and his wife, Renee Everett. Nonetheless, and in spite of the fact that Ms. Everett owned a 50% share of EAGB at the time of signing the franchise agreement, EAGB and Matthew Everett informed the franchisor that Mr. Everett was the 100% owner of EAGB and therefore Ms. Everett was not required to sign the franchise agreement. The franchise agreement required consent from the franchisor before ownership in EAGB could be transferred. Six years into the franchise relationship, the franchisor terminated the franchise agreement for cause. Matthew Everett then transferred his 50% ownership interest in EAGB to Renee Everett and an EAGB employee. Renee Everett then continued to operate EAGB under a new assumed name and continued to serve the same customers from the same location, in spite of a provision in the franchise agreement prohibiting the operation of a competitive business for a period of two years after the termination of the franchise. The franchisor responded by initiating arbitration to enforce its covenant not to compete, resulting in the issuance of a unanimous award against Renee Everett. The district court, however, vacated the arbitration award finding that Renee Everett could not be bound to the arbitration provision as a non-signatory under a theory of direct benefits estoppel. The Seventh Circuit Court of Appeals reversed.
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
Removing Restrictive Covenants In New York
In Rockwell v. Despart, the New York Supreme Court, Third Department, recently revisited a recurring question: When may a landowner seek judicial removal of a covenant restricting use of her land?
Legal Possession: What Does It Mean?
Possession of real property is a matter of physical fact. Having the right or legal entitlement to possession is not "possession," possession is "the fact of having or holding property in one's power." That power means having physical dominion and control over the property.