Drafting Enforceable Noncompete Covenants in Franchise Agreements
Protecting Against Unfair Business Competition by Franchisees With Noncompete Provisions
Recording of a 90-minute CLE webinar with Q&A
This CLE course will provide guidance to business counsel for drafting clear and enforceable noncompete covenants in franchise agreements that protect franchisors from unfair competition and withstand court scrutiny, and for enforcing such clauses in court. The experienced panel will discuss the elements of effective noncompete provisions and review the latest case law developments regarding the enforceability of the clauses in franchise agreements.
Outline
- Policy reasons for and against noncompete agreements
- Differences between in-term and post-term noncompetes
- Best practices for drafting enforceable noncompete provisions in franchise agreements
- Review of recent court decisions on noncompete agreements between franchisors and franchisees
- Interplay of franchise noncompetes and nonsolicitation agreements
- Interplay with confidentiality agreements and trade secrets
- Bankruptcy of franchisee
- Enforceability against non-signatories
- Litigation strategies: how cases arise, typical strategies, TROs
- Differences between states regarding public policy of noncompetes
- Professionals and noncompetes
Benefits
The panel will review these and other key issues:
- What key provisions are typically included in noncompete provisions of franchise agreements?
- How should noncompete covenants be drafted to avoid being considered unreasonable, overbroad and unenforceable by the courts?
- What lessons can counsel glean from recent case law to avoid and/or overcome enforcement challenges with noncompetes?
Faculty
William G. Somerville
Shareholder
Baker Donelson
Mr. Somerville concentrates his practice in business litigation, including health care litigation, employment law and... | Read More
Mr. Somerville concentrates his practice in business litigation, including health care litigation, employment law and gaming law. In addition to defending employers in matters ranging from class action discrimination cases to wage and hour investigations, he has successfully handled a wide variety of complex and commercial cases on behalf of corporate litigants. He also has considerable litigation experience in the health care industry.He has also presented on trends and best practices for non-competes.
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Rochelle (Shelley) Spandorf
Of Counsel
Steinbrecher & Span
Ms. Spandorf is a nationally recognized business franchise and distribution attorney with more than 40 years of... | Read More
Ms. Spandorf is a nationally recognized business franchise and distribution attorney with more than 40 years of experience representing franchisors, manufacturers, licensors, suppliers, franchisees, and distributors in their domestic and international expansion and strategic development. She concentrates her practice on a broad spectrum of transactional and regulatory issues for clients in all industry sectors, from startups to mature public companies. Ms. Spandorf assists clients with their contracts and legal compliance including preparing franchise disclosure documents, domestic and international franchise and distribution agreements, and registration filings. She counsels franchisors, suppliers, and trademark licensors on a broad array of operating issues ranging from contract enforcement to trademark protection, relationship disputes, antitrust and pricing matters, terminations and transfers, mergers and acquisitions and implementation of system-wide changes. Ms. Spandorf represents U.S. franchisors in their international expansion activities and helps foreign franchisors bring their franchise system into the U.S. She assists companies in the acquisition and sale of franchise systems or franchise units by providing franchise due diligence reviews and lead counsel services. On behalf of franchisees and area developers, Ms. Spandorf assists with the acquisition and sale of franchise rights and various transactional assignments. She is one of ten attorneys in the United States ranked by Chambers USA in its highest category (Band One) of leading U.S. franchise attorneys. Ms. Spandorf is recognized as a certified specialist in franchise and distribution law by the California State Bar. She has the distinction of being the first woman to chair the ABA Forum on Franchising, the nation's preeminent association of franchise attorneys, and has twice chaired the California State Bar Franchise Law Committee in North America. Ms. Spandorf is a frequent speaker and author on franchise topics and resource to the press on franchise issues. She was named by her peers as a 2022 “Lawyer of the Year” in the franchise law category in Best’s Lawyers, and has consistently been recognized as a “Global Elite Thought Leader” in franchise law in Who’s Who Legal USA, another annual peer ranking.
CloseJames M. Susag
Shareholder
Larkin Hoffman
Mr. Susag's trial practice focuses on franchise, dealer and contract disputes, and real estate, construction and... | Read More
Mr. Susag's trial practice focuses on franchise, dealer and contract disputes, and real estate, construction and land use. Some of his recent successes include enforcement of franchise and dealer agreements in Federal District Courts and in domestic and international arbitration. He is a frequent writer, public speaker and panelist on franchise law issues.
CloseMark S. VanderBroek
Partner
Nelson Mullins Riley & Scarborough
Mr. VanderBroek is experienced in franchise law and litigation, intellectual property litigation and... | Read More
Mr. VanderBroek is experienced in franchise law and litigation, intellectual property litigation and counseling, business litigation, and construction law and litigation. In the area of franchise law, he counsels clients on franchise disclosure, regulation, contracts, compliance, and starting up/modifying franchise systems, litigates franchise and business disputes for franchisors and franchisees, and defends vicarious liability claims against franchisors. He previously co-authored an article on non-compete covenants published in the ABA’s Franchise Law Journal, addressing trends in relation to enforcement of non-competes in franchise agreements.
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