One of the most common lawsuits in franchising involves the “holdover” franchisee. In these cases, the franchise agreement has either expired or it has been terminated. The holdover franchisee, however, continues to operate his or her business as though nothing has changed and continues to use the franchisor’s trademarks and trade dress. The recent case Century 21 Real Estate, LLC v. Destiny Real Estate Properties found that a holdover franchisee can be held liable for trademark counterfeiting, which means that potentially large punitive damage awards can be available against holdover franchisees.
Author: Matthew Kreutzer, Las Vegas Franchise Attorney
Mr. Kreutzer concentrates his practice in franchising, with an emphasis in transactional franchise law and franchise litigation.
He has spent more than 15 years working with individuals and companies on issues relating to the franchise relationship.
Experienced in all facets of franchise law, Mr. Kreutzer assists both start-up and mature franchisors with developing, protecting and licensing their franchise and distribution systems. As part of this practice, he counsels companies regarding the laws and regulations pertaining to franchising nationwide and assists them in creating their contracts, Franchise Disclosure Documents, and other critical operational documents. He also responds to state administrative inquires and investigations, and obtains exemptions and interpretive opinions from regulatory agencies.
With his background in franchise litigation, Mr. Kreutzer understands the risks inherent in the relationship and works with his clients to limit those risks so that those franchisors can focus on brand and system growth.
Mr. Kreutzer received his B.A., cum laude, from The American University in 1995 and his J.D. from The George Washington University Law School in 1998. He is a certified specialist in Franchise and Distribution Law by the California State Bar Board of Legal Specialization (the “Board”) and is a Commissioner on the Board’s Franchise and Distribution Law committee.
Mr. Kreutzer is a longstanding officer and member of the California Franchise Law Committee, and is a member of the American Bar Association Forum on Franchising.
Mr. Kreutzer is an AV® Peer-Review Rated attorney by Martindale Hubbell and was named a “Super Lawyer” 2013 - 2017 and a “Rising Star” in 2012 by Mountain States Super Lawyers. He was honored as a “Legal Eagle” by Franchise Times magazine 2013 - 2017, and as one of the “40 Under 40” by In Business Las Vegas in 2010.
He is licensed to practice in the States of Nevada, California and Maryland.
Author of the "Forward Franchising" blog, located at www.forwardfranchising.com
Lawsuit Regarding Strip Club Ad Highlights Importance Of Franchise Brand Management
A recent lawsuit filed by sandwich franchisor Capriotti’s underlines the importance of brand management for franchise companies. The franchisor sued its Las Vegas-based franchisee, seeking to terminate the franchise agreement in reaction to the franchisee’s co-advertising campaign with a strip club, featuring the tagline “a match made in Vegas heaven: boobs and Bobbies.”
IFA Supports Business Activity Tax Simplification Act
One of the pieces of legislation currently pending before Congress that has the potential to significantly affect franchisors is the Business Activity Tax Simplification Act, or BATSA. BATSA would clarify federal tax law by resolving the question of economic “nexus” that is required for a state to succesfully impose an income tax on out-of-state companies.
Recent Franchising Stories Focus On Funding And Incentives
At the beginning of 2012, the big story in franchising appears to be the same one that we have seen for the last several years: money. Franchisors are still looking for answers to questions about growth in a time when it is difficult for prospective franchisees to find funding. There are a couple of good articles this week that demonstrate possible answers to these questions.
Surprise! You Just Starred In Our Movie
In a $3 million lawsuit, actor Jesse Eisenberg (star of The Social Network) claims that he was exploited by the producers of the direct-to-DVD movie, Camp Hell, when they overplayed his small role in the film by featuring his likeness on the DVD cover art. Franchising laws help to prevent this type of overstatement or puffery by requiring disclosure of important information to potential franchisees.
The McRib: A Marketing Success Story
A recent story in Inc. magazine talks about McDonald’s advertising campaign for the McRib sandwich as a good example of great marketing.
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