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Individuals elect to buy into a NYC franchise for various reasons, such as being a business owner, having support from a franchisor, and filling the desire of an entrepreneurial spirit. These individuals are dedicated to putting in the time and money to ensure that their newly acquired franchise business succeeds. Add on the additional stress and time demands of reviewing contracts and legal analysis, and some business owners might not be able to handle it all. Unfortunately, the dream of owning and operating your own franchise isn’t easily achieved, but it is possible with the help of an experienced franchise lawyer NYC.

What do franchise attorneys do?

A prospective new franchise owner will receive Franchise Disclosure Documents (FDD) from the franchise. These documents contain 23 informational items that outline the offered program agreement and whether it is a proven successful or untested and risky. Additional information that will be contained within the FDD will include:

  • The level of experience that the franchisor and its officers, directors, and executives.
  • The level of obligations that the franchise company will have to you and your business after you’ve opened.
  • Initial fees, and any reoccurring fees (such as royalties and advertising) that you’ll be required to pay.
  • Are there any financing arrangements that are provided?
  • A complete description of all startup costs incurred in the initial investment prior to and after opening your franchise.
  • Rights and restrictions regarding renewal, termination, transfer, and dispute resolution.

A franchise attorney, who is accustomed to seeing FDD’s, will be able to evaluate the disclosures made in your FDD, along with the terms of your franchise agreement before you sign any documents.

It is not uncommon for franchise agreements to favor the franchisor. Some agreements are extremely one-sided, favoring one party. When this is the case, the franchisors may be willing to negotiate certain terms, especially if they do not threaten or endanger their trademark. These should be negotiated by a franchise lawyer NYC.

Having a franchise attorney to protect your own interest is recommended, not only during the initial phases, but after all the contracts have been signed and you’ve opened your business. Franchise owners that do not retain their own legal representation are often hesitant to resolve issues with the franchisor. Because of their hesitancy to address issues as they come up, problems may persist, or worsen. Failure to act on problems as they arise, will eventually lead to loosing leverage against the franchisor, either as a result of contractual limitation periods or state statute of limitations.

Don’t fall into the trap of taking legal advice from the franchisor’s legal representation. They have their client’s best interest at heart, not yours. Hire your own attorney to protect your rights and ensure that you are being accurately represented. The office of Warren S. Dank, ESQ., P.C. has experience in effectively negotiating FDD’s to protect and represent their clients. If you are thinking about purchasing a franchise in NYC, don’t sign anything until you have talked to Warren S. Dank, ESQ., P.C.!