"What Revised Federal Civil Procedure Rules Mean for Litigation Between Franchisors and Franchisees"

Below is an excerpt:

The Federal Rules of Civil Procedure, which govern the procedures of litigation in federal courts, have a significant role in many franchise disputes. First, most franchise disputes that are taken to court proceed in federal court. This is because most franchise disputes involve claims under federal law, including primarily the Lanham Act which applies to trademark claims, or involve a sufficiently large dispute between parties from different states, which allows them to be brought in federal court. Second, many franchise agreements that contain arbitration provisions state that discovery in arbitration will be governed by the Federal Rules.

On Dec. 1, 2015, the most significant revisions to the rules in several years took effect. Particularly as parties and courts gain experience with the revised rules, these revisions may have an impact on the resolution of franchise disputes and may lead some franchisors to evaluate the dispute resolution provisions in their franchise agreements.

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Originally published in Franchising World Magazine, March 21, 2016