December 30, 2011 in Business, Legal, Legal Articles by jferris

Restaurant Woes in the Down Economy Increase Franchise Litigation

Franchisee-franchisor relations are getting tense in the down economy. Several companies such as Wendy’s, Burger King, and Quiznos have been in the headlines because of franchisee unrest, including charges of racketeering and corruption and complaints about food costs, supplies, and the use of marketing and advertising funds.

“When your profits are gone, the first place you look is to see who is taking the most money off you,” said Kevin Tackett, the president of the Quiznos Franchisee Association (QZFA).

With less people going to restaurants, franchisees start to look around the store for answers. Is it new food that is cutting into profits, forced advertising campaigns, or upgrade costs, for example? When a franchisee feels that their part of the franchise agreement is not being upheld, they should present their concerns to a franchise attorney, allow him or her to review the terms of their agreement, advise on those terms and potentially seek to initiate negotiations or litigation against the franchisor. Resolving a franchise dispute quickly is essential to making sure the business can run smoothly and be profitable.

Wendy’s recently settled with its largest franchisee, the WendPartners Franchise Group, after it wanted stores to install new toasters for an up-and-coming cheeseburger that would increase sales by more than two percent. Big costs like new toasters across many stores can be tough when profits are not as plentiful as they were in the past.

Burger King settled a lawsuit with its franchisees in the spring after store owners were required to sell a double cheeseburger for $1 as part of a promotion. Franchisees said they were losing at least a dime per sandwich, and when you add it up, it hurt their bottom line. The Burger King National Franchisee Association says the settlement has been a positive step that allows franchisees to have more input in future promotions. The restaurant is also hoping that a menu makeover will also drive more profits to the franchisees.

Quiznos survived a slew of franchisee lawsuits back in 2009 too. Franchisees were in disputes over royalties, marketing funds, and food and supply issues. The QZFA seeks to work with Quiznos Corporate in an open way so that business decisions are more transparent and profit concerns are addressed more efficiently.

And even over at KFC, the franchisee-led KFC National Council and Advertising Cooperative (NCAC) won a recent battle against the corporate office over advertising. Advertising strategies and promotional dates should be a discussion between both sides to have the most impact.

In the end, franchisees are wise to have a franchise lawyer on speed dial and open lines of communication with their fellow stores. The downturn in the economy is too severe to go it alone against the corporate office.

Anthony Spotora is a Los Angeles business lawyer, Los Angeles franchise lawyer, and Los Angeles business litigation attorney. To learn more, visit Spotoralaw.com.

December 28, 2011 in Business, Legal, Legal Articles by jferris

Texas Moves to Number 1 For Business Climate

The Lone Star State passed North Carolina for the No. 1 spot on Site Selection Magazine’s ranking of top business climates.

Texas had been in second place behind the Tar Heel State for almost a decade, but edged to first place in November’s rankings. Texas claimed more than half of the inbound business relocations and about 40 percent of all the new jobs in the United States since 2009.

An annual study of corporate relocations by Atlas Van Lines showed 7,200 companies moved to Texas in 2010.

Part of the publication’s ranking comes from a close look at each state’s new and expanded facilities, total projects in relation to population, the state’s business tax climate and how each state did in the magazine’s “Competitiveness Ranking”, published in the spring.

The rest of Site Selection’s ranking criteria comes from comments from business owners themselves gathered in an executive survey. The publication heard repeatedly that Texas’ available workforce was a key component to choosing the state for a business location. But the magazine also heard that the state’s 2003 tort reform and comparatively low barrier to entry also played a big part. Some of the respondents said the state’s lack of an income tax played a role and others said the government simply makes it easier to do business there.

As Texas businesses climate continue to be attractive, so will Texas’ mergers and acquisitions activity. Across a span of industries from health care and technology to construction and real estate, a more vibrant business community feeds an appetite for acquisitions.

The magazine’s business climate analysis of Texas included a look at the top cities in each size category. Forbes Magazine published a list of Best Cities for Jobs. In that ranking, Texas owned the field.

In the small metro area category, Texas has three of the top five cities in the country. In the mid-sized metro area, Texas has three of the top five cities in the country and in the large metro area category, four Texas cities are in the top five in the nation, including Dallas.

The publication also looked at office space as an indicator of where companies are doing business this year. The analysis showed that Dallas is drawing relocating companies from California and the city expects more activity as the market continues to improve.

Executives at new companies, emerging companies and relocating firms all see Texas as a business-friendly environment where their business can grow and thrive, according to the magazine.

Seth Wilburn writes for the Gomez Law Group, a Dallas employment lawyer and Dallas business lawyer. To learn more, visit Gomezlawyers.com.

December 19, 2011 in Business, Legal, Legal Articles by jferris

Texas Oil and Gas Attorney Jordan Highlights Opportunities in Eagle Ford Shale

The Eagle Ford shale in south Texas is one of the latest oil and gas hotspots. Estimates predict that billions of dollars of oil and gas will be produced from this very thick layer of rock. Production has almost quadrupled for natural gas, and oil has increased tenfold in just one year alone. With some leases going for over $10,000 an acre, landowners and communities stand to gain substantial monies and appreciation of their properties.

Yet at the same time, some oil and gas pipeline companies have been wielding their influence to take advantage of the situation and exercise their eminent domain powers at the expense of landowners. Numerous companies are vying to construct pipelines across thousands of miles of land to handle the new production. Earlier in the year, pipeline companies could claim eminent domain to acquire an easement on a coveted piece of mineral-rich property with few restrictions. Texas law allowed them to do so and the only recourse landowners sometimes had was to try to negotiate for compensation or possibly face a lawsuit from the pipeline company.

But since Sept. 1, Texas law now says that pipeline companies must make a good faith offer to the landowner and give the landowner more time to respond to the offer before the company can file a lawsuit. There are numerous other requirements that pipeline companies must now meet and there are also numerous additional rights and protections that have been granted to landowners. Lawsuits have gone up sevenfold in the last year as companies vie for their piece of the Eagle Ford shale. Individuals and communities have shown concern about the pace of development and their rights being suppressed.

A skilled Texas oil and gas attorney can give legal guidance to landowners to ensure they are having their rights upheld, know their options, and that an offer is adequate and fair. Any offer a pipeline company gives should be based on numerous factors, including a current appraisal of the land or easement’s value. Should negotiations break down, a skilled oil and gas lawyer can be critical for having the landowner’s concerns addressed in a courtroom. An Eagle Ford oil and gas attorney can also assist when an oil and gas lease dispute arises or conflicts over mineral rights, drilling, or environmental issues surface.

The Law Offices of Gregory D. Jordan counsels individuals and landowners in the Eagle Ford Shale area of south Texas. Texas oil and gas lawyer Gregory D. Jordan has decades of oil and gas industry experience, not only from the legal perspective, but also from his background as a petroleum landman and petroleum engineer.

Gregory D. Jordan is an Austin oil and gas attorney, Austin business attorney, and Austin business litigation lawyer. To learn more, visit Theaustintriallawyer.com.

December 16, 2011 in Business, Legal, Legal Articles by jferris

Logos Are Important Business Assets to Trademark As Noted In Recent Court Case

Logos are one of the cornerstones to a business’ sales and marketing identity. It can be as essential as the business itself for a brand’s identity to clients and the public. Logos that are not thought out or resemble other well-known logos may not only appear amateurish to the audiences the business is trying to attract but may further be committing infringement. An individual or a business can protect an original logo, provided it has proof of authorship via the U.S. Copyright Office and/or by registering for trademark protection through the United States Patent & Trademark Office.

Original authorship on websites, business slogans, and even innovative marketing campaigns are critical to protect. A skilled intellectual property attorney can help you acquire and protect these coveted assets that mean so much to your business. Otherwise, these parts of your business could be jeopardized because you did not get adequate protection. It is worth the time and investment to have an experienced attorney help you with these steps.

It is important to note that if you are the first to use a name, logo, or slogan in a geographic area, then you might have gained some common law rights and have a ‘first use’ argument. You have the right to initiate a lawsuit should someone infringe on these business assets, but they are limited without registration. So if you want to protect these assets on a national or international level, you must register and trademark them.

In a recent intellectual property suit, graphic designer Bill Dawson was shocked to find that a logo design he created for an independent film company was on the big screen, when months before the company had expressed no interest in his designs. This issue started when the designer saw his logo at the end of the Conan the Barbarian movie, but then he noticed it was in several Millennium films, including Elephant White, Trespass and Puncture, and that it was also on Millennium’s website. Dawson is claiming at least $200,000 in damages for copyright infringement and breach of contract for unauthorized use of his work.

Originally, Dawson had been contacted by Technicolor, a technical production services company to create a logo for Millennium Films for a small fee. Dawson, as the head of the graphic studio XK9, says that he had a verbal contract with a Technicolor agent. But when Millennium did not show any signs of interest in the designs, no further compensation was pursued.

That there seems to be a missing gap of information between Dawson, Technicolor, and Millennium in this exchange will make for a very interesting court case. Perhaps the court case will show what the agreement, if any, was between Technicolor and Millennium. Regardless, the lack of written terms will likely weigh in Dawson’s favor under copyright laws. As the rightful owner of the designs, he is seeking $200,000 in damages and wants any products, advertising, and marketing collateral with the unauthorized logo to be given back to him.

Anthony Spotora is a Los Angeles intellectual property lawyer, Los Angeles entertainment lawyer, and Los Angeles business litigation attorney. To learn more, visit Spotoralaw.com.

December 14, 2011 in Business, Legal, Legal Articles by jferris

Severance Packages Should Be Closely Reviewed

As the country continues to slog through a tough economy, there are still companies choosing to downsize and many of those companies offer severance packages as a matter of policy.

When an employee is let go and the company offers a severance package, there are a few things to remember about the process that could have an effect on that employee’s ability to move on to the next job.

Companies are not required to offer severance packages. About 60 percent of businesses in the United States have a formal severance plan policy.

Those policies are written to provide a soft landing for the exiting employee and legal protection for the company. In many instances, a severance package is the easiest way for a company to let people go quickly and quietly. Many companies require exiting employees to sign legal paperwork promising they will not sue the company for discrimination.

Attorneys suggest having a consultation before signing severance package paperwork. If there are any reasons an exiting employee may have to claim a discrimination suit against the company, the opportunity is lost once the paperwork is signed.

Company severance policies will outline who is eligible – salaried employees, hourly employees, contract workers, and more. The policy also likely explains the circumstances under which a severance is offered – involuntary reductions in staff – and what needs to happen for a severance to be withheld such as termination for cause.

The company policy likely will cover how the severance will be calculated – often a factor of length of service. And the company will have rules about what type of legal paperwork the exiting employee will be required to sign.

Severance package legal paperwork may also include non-compete clauses that could limit an employee’s ability to seek out a similar job in a similar industry.

Most corporate severance packages include some negotiable elements and exiting employees can sometimes get a better deal in the right circumstances. Compensation elements that can be negotiable include pay, unused paid time off and insurance.

All companies’ severance packages differ depending on the type of employee. For some employees, the offer will be two weeks salary. For higher-level employees it could be six months or a year’s salary. Many companies calculate an offer based on the length of service and level of employee.
Paid time off can be negotiable in some cases. If an employee has unused PTO and/or sick days, then a company may be willing to factor that into an offer. Occasionally, state law can require companies to pay for unused PTO.

Lastly, companies sometimes will require an exiting employee to waive the right to collect unemployment compensation benefits. There are many details in a severance package that should be carefully looked at it by an experienced employment attorney before signing.

Seth Wilburn writes for the Gomez Law Group, a Dallas employment lawyer and Dallas business lawyer. To learn more, visit Gomezlawyers.com.