Franchise Termination / Non Renewal
Sometimes, franchisors or suppliers attempt to terminate the relationship with their franchisee or dealer, even though the franchisee or dealer has done a good job. Under the prevailing contractual and statutory law of many states, a franchisor/supplier cannot terminate a dealer or franchisee without good cause—meaning that as long as the franchisee does the job, he keeps the line.
Dady & Gardner franchise attorneys have enjoyed many successes battling franchisors and suppliers over their attempts to terminate franchisees when there is not good cause, sometimes winning court orders preventing the termination, sometimes winning money damages (into the millions of dollars) for terminations that took place that we proved were not justified. These situations sometimes arise because the franchisor or supplier wants to take over a lucrative franchise for itself, or to consolidate its dealerships, or to transfer the dealership or franchise to a favored successor. To see how we have fared in the past with terminations, please check out our Big Cases – Termination.
Franchisors and suppliers sometimes attempt to achieve the same result as termination through a refusal to renew the franchise or dealer agreement at the end of its term. Many statutes prevent the franchisor from doing so and allow the franchisee or dealer to continue in business so long as the franchisee is capably performing. Dady & Gardner has been able to obtain compensation for dealers and franchisees whose suppliers or franchisors have refused to renew them without good cause and has been able to obtain court orders preventing such non-renewals and keeping the businesses alive. For further information on our track record, please click here on Big Cases – Termination.
Please feel free to contact us to schedule a free consultation.