Lead-Off Mgmt., Inc. v. Congo Brands Holding Co., Inc., No. RDB-24-2060 (D. Md. Mar. 31, 2025). Facts Lead-Off Management, Inc., a beverage distributor based in Maryland, filed a lawsuit against Congo Brands Holding Co., Inc., a beverage producer and supplier, alleging promissory estoppel and fraud. The dispute arose when Congo approached Lead-Off in late 2020 to expand its brand presence in the region and gain access to Giant supermarkets. Lead-Off claimed that Congo repeatedly promised to sign a standard distribution agreement, which was never executed. Despite assurances, Lead-Off signed a Brokerage Agreement in March 2021, which it claimed did not establish relevant compensation terms. Congo products were delivered to Giant stores in April 2021, but Congo severed the relationship with Lead-Off in March 2022. Lead-Off alleged that Congo reapproached them for guidance and again promised to sign the Distribution Agreement, leading Lead-Off to continue its efforts until October 2023. Lead-Off claimed to have spent $1,499,700 on product and distribution based on Congo’s misrepresentations. Court Decision The U.S. District Court for the District of Maryland granted Congo’s Motion to Dismiss both claims. The court dismissed the promissory estoppel claim without prejudice, allowing Lead-Off to amend the complaint. The fraud claim was dismissed with prejudice, as the court found that Lead-Off failed to meet the heightened pleading standard required for fraud under Rule 9(b). Legal Analysis For the promissory estoppel claim, the court found that Lead-Off did not establish a “clear and definite promise” from Congo to sign the Distribution Agreement, which […]

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Factual Background In August 2023, National Equipment Dealers, LLC (NED) and IROCK Crushers LLC (IROCK) entered into an industrial machinery distribution agreement, under which IROCK sold equipment to NED for resale. The agreement included a mandatory forum selection clause requiring legal proceedings to be conducted in Cuyahoga County, Ohio, and a choice of law clause stating that Ohio law would govern the agreement. IROCK terminated the agreement in August 2024 under a “Termination for Convenience” clause, which allowed termination with or without cause upon ninety days’ notice. Upon termination, IROCK refused to repurchase NED’s inventory, as the obligation to repurchase only applied if the agreement was terminated for breach by IROCK, which was not the case here. Procedural History Following the termination, NED filed a lawsuit in North Carolina state court, claiming IROCK’s refusal to repurchase inventory violated the North Carolina Farm Machinery Franchise Act and the Unfair Trade Practices Act. IROCK removed the case to federal court and filed motions to transfer the venue to the Northern District of Ohio and to dismiss the case. NED filed a motion to remand the case back to state court, arguing procedural defects in IROCK’s removal. Court Decision The U.S. District Court for the Middle District of North Carolina denied NED’s motion to remand, finding that IROCK complied with the federal removal statute and that any procedural omissions, such as the late filing of a corporate disclosure statement, did not warrant remand. The court granted IROCK’s motion to transfer the case to […]

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While several states have franchise laws, many do not. If you live in a state that doesn’t have a franchise law, what does this mean for you? National franchisee lawyer Jeffrey M. Goldstein explains.

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As a franchisee, you have the right to expect your franchisor to comply with the terms of your franchise agreement. You also have the right to expect your franchisor to comply with applicable law. But what does this mean, exactly? National franchisee attorney Jeffrey M. Goldstein explains.

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For franchisees, holding franchisors accountable often means pursuing franchise arbitration. The substantial majority of franchise agreements include mandatory alternative dispute resolution (ADR) provisions, and most of these require franchisees to pursue arbitration rather than going to court. For franchisees who are considering legal action against their franchisors, consulting with an experienced franchise lawyer is generally the first step toward determining whether arbitration is warranted.

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The “joint employer” standard has been a hot topic in the franchising world for nearly a decade. This standard is used to determine when multiple entities can be considered employers of a single employee, with the primary purpose of establishing the employee’s right to pursue remedies for discrimination, harassment, workplace injuries, and other forms of harm. Franchise attorney Jeffrey M. Goldstein has written about this topic in the past—first when the National Labor Relations Board (NLRB) issued the Browning-Ferris decision that expanded the federal definition of “joint employer” in 2015, and more recently when the House introduced the failed Protecting the Right to Organize (PRO) Act in 2020.

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A recent article in the Franchise Times discusses the rising costs of opening and operating a franchise. According to the article, “[d]evelopment and buildout costs across the board have increased, and it’s led a majority of franchisors to bump what’s financially needed for a franchisee.” As the article goes on to explain, in a recent survey, “93.9 percent of franchisors indicated inflation has forced them to increase cost estimates in . . . Item 7[ of their Franchise Disclosure Document (FDD)].”

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Laws in various states prohibit franchisors from engaging in unfair franchise practices and entitle franchisees to seek remedies when their franchisors violate the law. This raises two critical questions: What constitutes an “unfair franchise practice,” and what can (and should) you do if you are a victim? National franchisee attorney Jeffrey M. Goldstein explains:

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According to the International Franchise Association (IFA), the health and wellness industry has been growing at a rate of 5 to 10 percent annually and was valued at $480 billion as of 2024. Does this mean that it’s time to buy a health and wellness franchise in 2025? National franchise attorney Jeffrey M. Goldstein shares his thoughts:

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The International Franchise Association (IFA) recently released the results of its 2024 Annual Franchisee Survey. In this article, national franchise lawyer Jeffrey M. Goldstein shares his thoughts on the IFA’s latest data.

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