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Tampa Business Litigation Attorneys / Tampa Franchise Litigation Attorney

Tampa Franchise Litigation Attorney

Franchises are great opportunities for those who want to own a business.  A franchise allows a business owner to step into an existing business model, yet run their operations independently, just as any other business owner does. However, there are disputes and issues that can arise between a franchisor and a franchisee. Below, our Tampa franchise litigation attorney advises on how to avoid these so your business does not suffer.

What is a Franchise?

A franchise is a business that is legally permitted to use the name, copyrights, logo, and practices of a larger company. The larger company is known as the franchiser, and it allows the use of these distinct items. The franchisee is the owner of the smaller business that is part of the larger whole and they pay a fee and a percentage of their profit in order to use certain components of the business.

While franchises are part of a larger business model, franchisees are still responsible for operating their business at an independent level. This means that franchisees must hire and fire their own employees, schedule workers, and always ensure they have enough product available. Franchisers, on the other hand, still maintain some control over how the franchisee conducts their business, such as stipulating what products are offered.

The Federal Franchise Rule

In the United States, all franchises are governed by the Federal Franchise Rule. Under this rule, all parties involved in a franchise are given important information that helps them weigh the risks and benefits of the investment. Additionally, franchisors must provide franchisees with a disclosure document, according to the rule. The disclosure document must include certain information, including:

  • The name of the franchise owner, parent companies, and/or affiliates
  • Estimates for start-up costs
  • Existing bankruptcies
  • The franchisee obligations to the franchise
  • Business restrictions
  • Advertising and assistance provided by the franchisor
  • Territorial rights and limitations
  • Dispute resolution procedures
  • Financial performance

Franchise Agreements

As in any business relationship, it is crucial that there is a written agreement between the franchisor and the franchisee. A franchise agreement grants one party the right to use the business name, model, and logo to run their business. A franchise agreement should also establish all aspects of the partnership. Any time one party goes against the terms of the agreement, the document provides legal recourse. Common examples of franchise agreement violations are as follows:

  • A violation of a non-compete clause by the franchisee
  • Failure of the franchisee to pay royalty fees
  • The franchisee misuses information about the franchise
  • The franchisor competes or encroaches on the franchisee’s business
  • The franchisor fails to support or train the franchisee properly

Our Franchise Litigation Attorney in Tampa Can Help Resolve Your Dispute

Franchise law is a very complicated legal area. At BBDG Law, our Tampa franchise litigation attorney can help you resolve any dispute you are facing and will give you the best chance of a favorable outcome. Call us today at (813) 221-3759 or fill out our online form to schedule a consultation and to get more information.