Legal Question in Business Law in New Jersey

Re: Franchise law / business law

I would be more than happy to help you with this. You live near my New Brunswick office. Feel free to call me at 732/247/3340.

Re: Franchise law / business law

This truly depends upon the terms of your franchise agreement, but in general, non-compete provisions are enforceable in New Jersey so long as the scope of the provision is reasonable.

I would need to review the agreement and your situation in more detail to be able to give you a more detailed and comprehensive response. Feel free to give my office a call.

Re: Franchise law / business law

I would treat this as a serious problem. Don't sit on it. Get a lawyer to review the applicable documents and get the problem resolved with the franchisor. Here's why:

My guess is that the franchise agreement prohibits the kind of competition that results from your operating another business in the same field, in the same territory, but under a different name. Exceptions are common where a franchisee operates two franchised territories or where the franchisee has an existing, similar business that competes in the same market, but which is part of an affinity group. That arises for example if you were to already own a KFC franchise and wanted to open a nearby McD. However, if you are in direct competition with your franchised business, the franchisor is not likely to think of this as helpful.

Your problem is the risk. If you don't settle the matter and you lose a suit, you could lose the franchise and much of the customer base from your other business.

Don't panic. Just get help and good advice. Get the matter resolved and agreed to in writing.

My firm handles matters of this type. If I can be of further help to you, call or email.

See also: http://info.corbettlaw.net/lawguru.htm

Re: Franchise law / business law

I dont know if you have hired an attorney to advise you in this situation, but I have many years of franchise law experience and would be delighted to assist you in this matter.

Re: Franchise law / business law

Did you have your tax and business attorney review the franchise agreement with you prior to signing? Typically, franchise agreements contain a "Covenant Against Competition" which could prevent you (or a business you own) from directly competing.

You should IMMEDIATELY get a good tax and business lawyer to review what you have signed and to help devise a strategy for handling the issue.

I hope this helps!

Ron Cappuccio

http://www.BusinessEsq.com