TOP

Here’s Our Chance

Your Congressman/woman is at home, in the district, from now until September 13, 1999. That is your opportunity to call for a face-to-face visit to discuss support of The Small Business Franchise Act. As mentioned elsewhere in this Blast Fax, The Small Business Franchise Act of 1999 is being readied for introduction. Congress needs to know that you support this effort. That’s where your phone call to your Congressman/woman is so important.

Steps to Take: 1) Call Your Congressional Office. Ask for a meeting to discuss The Small Business Franchise Act. If a staffer asks for a bill number, let them know that it has not been introduced this session of Congress, but last session, the bill number was H.R. 4841. 2) Call Samuel Crawford at the AFA office (312-431-0545) for an update on the status of the bill, talking points and leave-behind materials. 3) Log on to the AFA website at www.franchisee.org to print out a summary of H.R. 4841. The Small Business Franchise Act of 1999 will be introduced with basically the same provisions as H.R. 4841. 4) Go to the meeting with your Congressperson (and/or their staff) and let them know how important this bill is to you, your family and your business’ longevity. 5) Call Samuel Crawford to brief him on how your meeting went and to give him the name of your Congressperson’s staffer, which Samuel will in turn, give to our Washington lobbyist for follow-up.

Just call!!

If you don’t want to have a face-to-face meeting, then just pick up the phone and call 202-224-3121. Ask for your Congressman/woman’s office and tell the person who answers the phone that 1) you want your Congressperson to co-sponsor The Small Business Franchise Act of 1999; 2) tell them to contact Congressman Howard Coble’s office (202-225-3065) so they can be included as a co-sponsor upon introduction; 3) call Samuel Crawford at the AFA to let him know that you made your phone call.

House Members’ Town Hall Meetings

If you cannot get a private face-to-face meeting with your Congressperson then go to a town hall meeting, raise your hand and bring up The Small Business Franchise Act. They will be happy to hear from you. Contact Samuel Crawford (312-431-0545) for a schedule of town hall meetings in your area.

TOP

LEGAL BRIEFS

Dairy Queen Franchisees Lose Monopolization Claim

In Hugh Collins, et al vs. International Dairy Queen, plaintiff franchisees sued claiming that the franchisor’s purchasing requirements were grounds for monopolization and anti-trust violations. On August 4, 1999, the U.S. District Court Judge for the Middle District of Georgia granted the franchisor’s summary judgment motion and dismissed the monopolization claim. The court held that since the franchisees were required to purchase from a warehouse which in turn purchased from International Dairy Queen, the franchisees were indirect participants. According to this ruling, under Section 2 of the Sherman Act, franchisees cannot sue for damages because the warehouses--not the franchisees--were direct purchasers of product from International Dairy Queen.

In the future, franchisees in general may be hard-pressed to assert damage claims under the anti-trust laws no matter how egregious the monopolization. If the franchisor simply follows the example of selling product to franchisees through an intermediary such as a distributor--no matter how ill-gotten the gains are--the franchisor is protected.

Dairy Queen franchisees will still move forward on both the tying claims, which include punitive damages, and the injunctive claims against International Dairy Queen.

The AFA is accepting ideas for topics for the Year 2000 Franchisee Legal Symposium scheduled for Coeur d’Alene, Idaho. If you would like to present or learn about a specific topic, please write a sentence or two about the topic’s content, give a title to the workshop session and let us know if you think it should be presented as a concurrent workshop or general session.

Regulators Meet With Franchisee Lawyers

On June 25, 1999 in Chicago, Illinois, federal and state franchise regulators met with members of the franchisee bar at a first-ever meeting coordinated by the American Franchisee Association (AFA). The purpose of the meeting was to develop better working relationships between those lawyers who primarily represent franchisees and those regulators who are often called upon to provide redress to franchisees harmed by certain franchisors.

Steve Toporoff and John Singer traveled from the Federal Trade Commission’s (FTC) offices in Washington, DC to attend the meeting. State regulators attending included Dale Cantone from the Maryland Office of the Maryland Attorney General; Martin Cordell from the Washington Department of Financial Institutions; Bob Tingler and Gene Bian from the Illinois Office of the Attorney General; Brian Silverman from the Virginia Office of the Attorney General and David Cohen from the Wisconsin Department of Financial Institutions.

Discussion was wide ranging and included suggestions on ways both regulators and private attorneys might work together to bring enforcement proceedings. Discussion also included ideas about how private attorneys and regulators can complement each other’s roles and objectives. All parties agreed that this type of meeting was long overdue. The group has plans for a second meeting in the Year 2000.