A new type of email scam targets franchise attorneys. This post will help franchise lawyers recognize the scam and avoid being defrauded.
A franchisee who sued his franchisor for fraud learned the hard way why it’s important to read the Franchise Disclosure Document, cover to cover, before buying a franchise. The California Court of Appeals ruled against him because the disclosure document Big O gave to the franchisee before he bought contradicted each and every one of his claims.
A recent Wisconsin Court of Appeals case addresses the use of exculpatory clauses in franchise agreements, and determines that the clauses relied upon by the franchisor to avoid liability were both insufficiently specific and not conspicuous. As a result, the exculpatory clauses failed to protect the franchisor against fraud claims by the franchisee.
Here’s an interesting case I recently came across. It features a franchisee based in Italy suing its California-based franchisor in California, alleging violations of California’s franchise laws.