A federal court in California recently granted a motion brought by a franchisor and two of its employees to compel arbitration and dismiss an action alleging violations of the California Franchise Investment Law, breach of the implied covenant of good faith and fair dealing, and misrepresentation. Singh v. Batteries Plus, LLC, 2024 WL 2132525 (E.D. Cal. May 13, 2024).
A federal court in Illinois recently denied cross motions for partial summary judgment as to franchisor 360 Painting, LLC’s claims for breach of contract by painting franchisee R. Sterling Enterprises, Inc. (RSE), and breach of guaranty by RSE’s guarantor for failure to pay certain royalties and fees. 360 Painting, LLC v. R. Sterling Enter., Inc., 2024 WL 2113035 (N.D. Ill. May 10, 2024).
A federal court in North Carolina denied a hotel franchisor’s motion to dismiss a customer’s breach of contract claim. Brittian v. Extended Stay America, 2024 WL 1841600 (W.D. N.C. Apr. 26, 2024).
A federal court in Colorado denied WD Ventures, LLC’s motion to dismiss for forum non conveniens pursuant to the forum selection clause in the parties’ franchise agreement indicating that the parties contemplated federal litigation in Colorado. Old Chicago II Franchising, LLC v. WD Ventures, LLC, 2024 WL 1911221 (D. Colo. May. 1, 2024).
A federal court in New Jersey denied plaintiffs’ motion for reconsideration or leave to file an interlocutory appeal challenging the court’s decision to grant defendants’ motion to transfer the case to the Western District of New York. Minnebo v. Metal Supermarkets Franchising Am. Inc., 2024 WL 1928458 (D.N.J. Apr. 30, 2024).
A federal court in New York recently granted a motion to dismiss for lack of personal jurisdiction in an action asserting claims that franchisor Hyatt Corporation acted with negligence in connection with assaults to guests that occurred at a resort in the Dominican Republic. Christie v. Hyatt Corp., 2024 WL 2387513 (E.D.N.Y. May 23, 2024).
On May 10, 2024, the DOJ announced criminal indictments and the SEC filed a civil lawsuit for alleged securities fraud against FAT Brands and related persons.
A very large class action settlement involving payment cards has an approaching deadline for class members to file claims. The class is very broad, defined as “all persons, businesses, and other entities that have accepted any Visa-Branded Cards and/or Mastercard-Branded Cards in the United States at any time from January 1, 2004 to January 25, 2019.”
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The Franchise Memorandum is a collection of postings on summaries of recent legal developments of interest to franchisors brought to you by Lathrop GPM LLP.
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