Latest case to deal with 'encroachment' upon a franchisee seems to be based more on the franchisor's bad faith than an implied covenant not to compete

Article Abstract:

Changes in the franchise business have resulted in attempts by some participants to draw legal lines between fair competition and encroachment. Illegal conduct in the franchise field can be addressed by contract law theories including covenants of good faith and fair dealing. Franchisors and franchisees are in the same overall business and the franchise fees and royalties received by the former would not be enough to compensate them for selling franchises into an overcrowded market. A failed franchise would hurt the franchisor's trademarks, reduce its revenues and affect its ability to sell future franchises. One of the cases discussed is Vylene Enterprises, Inc. v. Naugles, Inc.

Innovations, Unfair competition (Commerce), Unfair competition, Bad faith (Law)

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FTC-DOJ project; agencies collaborate on antitrust policy; practitioners await clear rules to mark when a joint venture can run afoul of antitrust law

Article Abstract:

The Joint Venture Project could become the most significant statement on federal antitrust policy since the merger guidelines which came out in the early 1980s, helping to clarify when a joint venture violates antitrust law. The project is the joint effort of the Federal Trade Commission (FTC) and the Department of Justice (DOJ), and Susan DeSanti, the FTC's director of policy planning, also directs this effort. Proposals offered include safe-harbor standards so that joint-venturers have clearly legal standards to work in and guidelines for the antitrust law on joint ventures.

Management, United States. Department of Justice, Joint ventures, United States. Federal Trade Commission

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New disclosure guidelines await review

Article Abstract:

The new franchise disclosure standards for the Uniform Franchise Offering Circular (UFOC) are ready for approval by the FTC. They respond to complaints about too much legal language and too little specific information wanted by prospective franchisees. The new guidelines require all UFOCs to be in plain English. Many of the guidelines are in chart form in order to simplify the UFOC. Other changes in the UFOC guidelines are listed.

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