Franchise Litigation and Dispute Resolution

Overview

Our team members have represented numerous clients in litigation, arbitration and/or mediation concerning franchises and dealerships.  Our clients in these types of relationships operate in industry sectors such as automotive services, auto rental, child day care, coffee shops, equipment dealerships, gas stations, hotels, restaurants and retail.  Our team members have extensive experience representing clients in other business disputes, which experience helps us effectively advocate for our clients who are franchisors, franchisees, manufacturers or dealers.

Many of these cases have included claims of fraud or misrepresentation in violation of the Maryland Franchise Registration and Disclosure Law, the FTC Franchise Rule, or other state franchise sales laws. Some cases have included claims of wrongful termination of the franchise and/or violation of antitrust laws with regard to required purchases by franchisees.  We have often represented clients battling over the enforcement of a post-termination covenant not to compete.

Name
Title
Contact
David L. Cahn
Partner
Emaildcahn@whitefordlaw.com
410.347.9442
Ilana Subar
Partner
Emailisubar@whitefordlaw.com
410.347.9419

Client Alert: "Not So Fast" – Maryland Gas Station Operator Obtains Injunction Stopping Franchise Termination

On May 25, 2022, the U.S. District Court in Greenbelt, Maryland issued a preliminary injunction ordering PMIG 1025, LLC and Petroleum Marketing Group, Inc. ("PMG") to continue its franchise relationship with the operators of the “Airport Shell” retail gas station and convenience store near Baltimore Washington International Airport during the pendency of the operators' case that PMG did not have good cause to end their petroleum franchise relationship under the U.S. Petroleum Marketing Practice Act (the "PMPA").  The Court, through highly respected veteran jurist Paul W. Grimm, ruled that the operators had a reasonable chance of prevailing on the merits of their claims that PMG improperly terminated the Franchise Agreement for the operation of Airport Shell.  The Court further found that the harm to the plaintiffs without an injunction issuing, namely losing control over their business, was greater than the potential harm to the defendants with such an injunction.

NLRB Issues Advice Memo Finding That Franchisor Is Not Joint Employer

On April 28, 2015 the National Labor Relations Board (“NLRB”), Office of the General Counsel, issued an Advice Memorandum to the NLRB’s Chicago area regional office finding that a restaurant franchisor and its Chicago area development agent are not joint employers with a Chicago franchisee.  This is an important development in light of the current pursuit by the NLRB’s General Counsel of joint employer cases against McDonald’s Corporation.