Free Consultation

Washington DC Franchise Attorneys

The “Go-To Guy” For Hardball Franchise Litigation.

– Multi-Unit Franchisee Owner ($3 Million case)

Inner Workings of Franchise Law

The “Go-To Guy” For Hardball Franchise Litigation.

– Multi-Unit Franchisee Owner ($3 Million case)

Franchisee Lawyer Looking Out Window

The “Go-To Guy” For Hardball Franchise Litigation.

– Multi-Unit Franchisee Owner ($3 Million case)

Planning your new franchise

The “Go-To Guy” For Hardball Franchise Litigation.

– Multi-Unit Franchisee Owner ($3 Million case)

Businesswoman opening a franchise

The “Go-To Guy” For Hardball Franchise Litigation.

– Multi-Unit Franchisee Owner ($3 Million case)

Nationally Recognized Franchise, Antitrust, and Commercial Contracts Trial Lawyers

Esteemed Lawyers of America Logo

Esteemed Law Firm Complex Litigation

Global Law Experts Logo

Recommended Firm in Franchise Litigation

Who's Who Attorney Logo

Top Attorney USA – Litigation

Avvo Franchise Lawyer Symbol

Superior Attorney in Franchising

Avvo Franchise Lawyer Symbol

Superior Attorney in Antitrust

Finance Monthly Global Award Winner Logo

Franchise Law Firm of the Year

Lead Counsel logo

Chosen Law Firm for Commercial Litigation

BBB of Washington DC

A+ Rated

Washington DC Chamber of Commerce

Verified Member

Lawyers of Distinction logo

Franchise Law Firm of the Year

ISSUU

Best Law Firm for Franchise Disputes in 2017

Law Awards Finanace Monthly

Franchise Law Firm of the Year

Top Franchise Litigator for Franchisees and Dealers

Top Franchise Litigator for Franchisees and Dealers

2017 Finance Monthly Award

2017 Finance Monthly Award

Testimonials

"Jeff, I am amazed that you were able to get the liquidated damages down that low, which allowed us to avoid bankruptcy. Until we retained you we had been dealing with hotel consultants who appeared to make little head-way in lowering the liquidated damages."

Multi-Unit Hotel Franchisee, Economy Segment
(value over $3 Million)

Get Legal Assistance from Franchise Lawyers Who Defend the Franchisee

The Goldstein Law Firm is a boutique national law firm that represents exclusively franchisees and dealers, not franchisors, suppliers or manufacturers. There are only a handful of franchisee lawyer specialists remaining in the country, as most have begun representing both franchisors and franchisees.

Franchise law is a multifaceted area of law that requires specialization. Any franchise attorney can tell you about a variety of cases where franchise agreements have gone south.

Here at Goldstein, our attorneys have as much as 30 years of experience handling all aspects of franchise litigation throughout the county.

We also specialize in franchise agreement assistance, bringing you the latest developments in franchise and distribution law. With the publishing of our Franchise Trends newsletter, we can help franchisees stay updated on developments concerning different legal aspects of franchising.

Dealing with the complexities and challenges of franchise law requires focus and specialization, which is why we represent dealers and franchisees exclusively. Unlike other firms, we at Goldstein are on the side of the franchisee. We can help you decipher the fine print of your franchise agreement and single out details your franchisor may not want you to know.

Without a knowledgeable and competent franchise consultant, you may be vulnerable to the pitfalls of franchise law. Simply walking away is not a viable solution if you’re looking to protect your assets and yourself from financially damaging consequences. For those who have already signed an agreement and are struggling with franchisor difficulties, our franchise law firm also provides legal assistance through its franchise attorneys.

Frequently Asked Questions on Franchise Law:

Do franchisors have an obligation to their franchisees to act competently?

In theory, it’s possible that a franchise attorney could prove that a franchisor violated a franchise agreement by poorly managing the franchise system. Inadequately capitalizing the franchise system or poorly managing advertising campaigns could potentially violate a franchise agreement.

However, there are few if any recent case findings in which a franchisor has violated the terms of a franchise agreement. And if the franchise agreement hasn’t been violated, the courts almost never support a free-standing claim of negligence against the franchisor.

In other words, courts have held that franchisors do not owe a duty of competence to their franchisees.

It’s interesting to note, however, that many franchise law firms stay busy addressing the flip side of this issue–whether the franchisee has acted negligently in operating his or her franchise

Do franchisors have a duty to provide support to their franchisees?

On paper franchisors have this duty to some degree. Most franchise agreements explicitly set forth the respective duties owed by both the franchisors and franchisees.

However, the provisions outlining those duties owed by franchisors are few and normally too ambiguous to enforce. Most franchise agreements include contractual language stating to the effect that “the franchisor doesn’t guarantee the success of the franchisee.”

In practice, this means that franchisors really don’t have a compelling duty to provide support to their franchisees.

Also, most franchise agreements require franchisees to state in their agreements that their business venture involves risks, one of the most prominent being the business knowledge of the franchisee.

This results in a double standard: The franchisor has only a few ephemeral obligations to the franchisor. But in contrast, the “whereas” provisions in the introduction of most franchise agreements indicate that the franchisor is the undisputed guru in operating franchises in that particular industry.

What are some of the most common duties imposed on franchisors under franchise agreements?

It’s important to recognize that these duties are incredibly limited in scope. That said, they include, among other things: (1) locating appropriate sites for stores, (2) managerial assistance, (3) advertising assistance, (4) providing operating manuals, (5) training, and (6) identifying third party vendors from whom necessary products and services may be sourced.

Keep in mind, these areas are so broadly defined that even the best trial attorney would have difficulty in trying to identify – never mind proving – the contours of such duties unless he or she had extensive experience within a franchise law firm.

Are franchisors permitted to modify their requirements or system standards during the term of the franchise?

Believe it or not, they usually can make these changes. Almost all courts confronted with this question have readily permitted franchisors to change the obligations owed to their franchisees during the term of the franchise.

Franchisors gain this fluidity by lacing their franchise agreements with language that “the franchisor is permitted to modify or change the Operations Manual.” They can then “incorporate by reference” the Operations Manual into the franchise agreement.

The franchisor’s unbridled discretion is further bolstered by language in the franchise agreement that “the franchisor may modify the Operations Manual in its ‘sole discretion.'”

Everybody knows that people and businesses are subject to liability for “negligence.” Can't franchisors be held liable for negligence to their franchisees as well?

The short answer is no, not under the common law of almost every state.

When the franchisee is only claiming economic loss – which is almost always the case -the franchisee must seek its damages through a breach of contract action.

The franchisee would have to prove that the franchisor violated the franchise agreement. This is very difficult to prove, as the franchisor’s duties are usually few, ephemeral, and deliberately vague.

It’s possible a franchisor could be found liable if he or she failed to work in good faith and with fair dealing, but this is a long shot.

Note, however, that courts have found franchisors liable for negligence in certain
cases where personal injuries were involved.

Read more FAQs

Recent Litigation Issues on Franchising, Distribution and Antitrust Law

The Covenant of Good Faith and Franchising in 2019: Survival, Opportunism, and Distortion

December 4, 2018

The Covenant of Good Faith and Franchising in 2019: Survival, Opportunism, and Distortion By: Jeffrey M. Goldstein The seemingly-omnipresent, but erroneous, belief that franchisors are legally prohibited at all times and in every instance from acting unreasonably or in bad faith vis-à-vis their franchisees is held not just by franchisees, but also by some prominent franchise lawyers. Rarely a day goes by without a potential client suggesting to me that his or her franchisor has acted unlawfully by having failed to meet its obligation to act in good faith and with fair dealing. Many times these franchisees repeat to me verbatim what they’ve just been told by another franchisee litigator to whom they’ve just spoken on the phone. Whereas franchisees generally readily latch onto the incorrect belief as a matter of survival, some franchise lawyers regularly peddle the myth to generate business. Quite simply, the misuse, misunderstanding and misapplication – intentional and unintentional — of the covenant of good faith in conversation, teaching and litigation leads ineluctably, over time, to a severe diminution in the inherent worth of the covenant of good faith as well as its use as a potential litigation tool for franchisees. The implied covenant of good faith and fair dealing is not applied uniformly by courts. Indeed, the covenant of good faith is a pure doctrinal bastard – sometimes it is viewed by courts as implied, and other times it is viewed as only explicit; sometimes it is used by courts to merely interpret a contract, […]


Read More

Is Amazon a Threat to Franchisees?

November 30, 2018

Amazon has been taking business away from brick-and-mortar stores for years. Despite promoting the benefits of selling through its marketplace to small businesses, it is clear that Amazon (along with other online shopping platforms that offer fast shipping and easy returns) is increasingly becoming a threat to retail businesses that rely on a steady stream of customers to maintain profitability. But, even for franchisees who do not have to compete with Amazon for customers, there is another potential risk as well—particularly for those located near HQ2 and Amazon’s various shipping and fulfillment centers around the country: the risk of losing out on quality employees. According to a recent article on franchise news website BlueMauMau.org: “Mark Zandi, chief economist of Moody’s Analytics, pointed out in a conference call . . . that Amazon announced it was increasing its entry level wages to $15 per hour, which is more than double the federal minimum wage. ‘It is indicative of how tight this labor market is,’ said Zandi. “He anticipates that this will put increasing pressure on employers that employ lower skilled workers to also raise their wages. ‘I fully anticipate wage growth accelerating as we move to 2019.’” As Amazon and other companies start offering higher wages even at entry-level positions, franchisees who find themselves struggling to make payroll may face even greater struggles in the near future. Are Franchisees Hiring? Will They Be Hiring in 2019? However, even as wages trend upward (many states have minimum wages increases set to take […]


Read More

NLRB Provides Franchise-Specific Guidance in Latest Update on Joint Employer Standard

November 23, 2018

The legal standard for determining when an entity may be considered a “joint employer” of another entity’s employees has been in a state of flux since the National Labor Relations Board’s (NLRB) Browning-Ferris ruling in 2015. While the NLRB reversed the Browning-Ferris decision late last year, the uncertainty over the past few years left a host of lingering questions, particularly in the world of franchising. To address these questions, the NLRB has been working on a set of regulations to help clarify when the joint employer standard should be applied. It recently released a first draft of its proposed regulations. The Joint Employer Standard in Franchising The proposed regulations start by defining what constitutes a “joint employer” (a definition that is notably absent from the current regulatory framework). As proposed: “[A]n employer may be considered a joint employer of a separate employer’s employees only if the two employers share or codetermine the employees’ essential terms and conditions of employment, such as hiring, firing, discipline, supervision, and direction . . . [and] a putative joint employer must possess and actually exercise substantial direct and immediate control over the employees’ essential terms and conditions of employment in a manner that is not limited and routine.” However, with regard to franchising, the NLRB has taken the position that, “[f]ranchisors generally exercise some operational control over their franchisees, which renders the relationship subject to application of the [NLRB’s] joint-employer standard.” Additionally, as noted in a recent article on BlueMauMau.org discussing the draft rulemaking, the […]


Read More

What Can You Really Hope to Negotiate in Your Franchise Agreement?

November 16, 2018

You have decided to buy a franchise. All that is left is to sign the franchise agreement and pay your initial franchise fee, and then you will officially own your own business. So, is it worth it to try to negotiate? Or, is it safe to assume that the franchise agreement is being offered on a “take it or leave it” basis? Unfortunately, over the past several decades, franchisors have honed the art of drafting one-sided franchise agreements. At the same time, franchise salespeople have come up with myriad ways to convince franchise candidates that negotiating is unnecessary. The truth is, if you are thinking about buying a franchise, it is strongly in your best interests to have the franchise agreement reviewed by an attorney, and most quality franchisors will expect you to request certain changes. Requesting Reasonable Modifications to Your Franchise Agreement So, the question then becomes, “What changes can I reasonably expect my franchisor to accept?” While there is no magic formula and nothing is ever guaranteed, some of the franchise agreement provisions that are most likely to be on the table include: 1. Initial Term Whether the initial term of the franchise agreement is too short or too long, this is a provision of the franchise agreement that often merits careful consideration. You want to make sure that you have enough time to recoup your investment, but you also want to avoid being locked in for too long if the business simply isn’t profitable. If you can […]


Read More

Franchise Industry Statistics: Most-Popular Industries and Locations

November 9, 2018

When buying a franchise, there are numerous factors that should guide your decision with regard to both (i) the type of franchise you choose, and (ii) where you choose to open for business. Statistics on the top franchised industries and top franchise locations can lean in both directions. On the one hand, it makes sense to choose a popular franchise in a location where people are used to shopping and eating at well-known brands. On the other, if you buy into too much competition in an over-saturated market, you could be setting yourself up for failure. Earlier this year, Franchise Direct published lists of the most-popular franchises and the locations that are most popular for opening a franchise. Neither list includes an explanation of its methodology, so take these for what they are worth. But, the rankings make sense, and even general trends are worth considering when deciding on the franchise opportunity that seems like the best fit for you. Most-Popular Franchised Industries According to Franchise Direct, as of May 2018, the 10 most-popular franchised industries in the United States were as follows: Food Franchises Children’s Franchises Coffee Franchises Home-Based Franchises Automotive Franchises Business Opportunities Vending and ATM Franchises Restaurant Franchises Cleaning Franchises Pet Franchises Notably, there is a bit of ambiguity in Franchise Direct’s list, as the list includes broad categories in addition to niche industries that could fall into one or more categories. For example, while “Children’s Franchises” ranks at number two, Retail Franchises come in just outside […]


Read More

Recent Blogs on Franchise, Dealership and Antitrust Law

Is Amazon a Threat to Franchisees?

Nov 30, 2018

Amazon has been taking business away from brick-and-mortar stores for...


Read More

NLRB Provides Franchise-Specific Guidance in Latest Update on Joint Employer Standard

Nov 23, 2018

The legal standard for determining when an entity may be considered a...


Read More

What Can You Really Hope to Negotiate in Your Franchise Agreement?

Nov 16, 2018

You have decided to buy a franchise. All that is left is to sign the...


Read More

Franchise Industry Statistics: Most-Popular Industries and Locations

Nov 9, 2018

When buying a franchise, there are numerous factors that should guide your...


Read More
Solutions franchise blog image

Reformist Thoughts on Franchise, Dealership, Distribution and Antitrust Law

2017 Best Franchise Litigators

April 11, 2018

2017 Best Franchise Litigators -- USA By Jeffrey M. Goldstein  Over my 30 years of practice I’ve from time to time been asked by clients “if we hadn’t chosen you as our litigator, which lawyers would you have recommended that we had chosen to litigate our case?” Just again two...


Read More

Franchise Lawyer, Jeff Goldstein, of Goldstein Law Firm

Choosing a Franchise Law Firm to Represent You

My Franchise Agreement is Expiring, Now What? (Part I of II)

Contact Us

Goldstein Law Firm, PLLC

1629 K St. NW, Suite 300,
Washington, DC 20006

Phone: 202-293-3947
Fax: 202-315-2514

Free Consultation

Free Consultation

Esteemed Lawyers of America Logo

Esteemed Law Firm Complex Litigation

Global Law Experts Logo

Recommended Firm in Franchise Litigation

Who's Who Attorney Logo

Top Attorney USA – Litigation

Avvo Franchise Lawyer Symbol

Superior Attorney in Franchising

Avvo Franchise Lawyer Symbol

Superior Attorney in Antitrust

Finance Monthly Global Award Winner Logo

Franchise Law Firm of the Year

Lead Counsel logo

Chosen Law Firm for Commercial Litigation

BBB of Washington DC

A+ Rated

Washington DC Chamber of Commerce

Verified Member

Lawyers of Distinction logo

Franchise Law Firm of the Year

ISSUU

Best Law Firm for Franchise Disputes in 2017

Law Awards Finanace Monthly

Franchise Law Firm of the Year

Top Franchise Litigator for Franchisees and Dealers

Top Franchise Litigator for Franchisees and Dealers

2017 Finance Monthly Award

2017 Finance Monthly Award