FTC Oversight of Franchisors Should Be on Case-by-Case Basis, Franchise Lawyers Say, article in The National Law Journal quotes Partner Abbye Alexander, 7-17-2024
The Federal Trade Commission’s comprehensive approach to address concerns about franchisors exploiting their control over franchisees would be better served through case-by-case oversight of the industry, franchise lawyers said this week….
Abbye Alexander, co-managing partner at Kaufman Dolowich’s Orlando, Florida, office, said the FTC’s broad policy statement on nondisparagement provisions goes against long-standing notions regarding the freedom to contract. “It definitely is a departure from the traditional view that most courts favor [which is] the right of parties to be able to contract on their own,” Alexander said. “The FTC Act allows the FTC to deem a practice unlawful if consumers can’t protect themselves, and the new guidance signals that … franchisees are at a greater disadvantage in terms of bargaining power. So they want to help them, and they want to help them protect themselves.” The FTC should oversee franchisors and franchisees on a “case-by-case basis because each set of facts is different,” Alexander added. “I don’t think that there should be a one-size-fits-all [approach].”
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