1. Franchise Fee New York – How the Dispute Started
The client contacted our team after paying a significant Franchise Fee to a New York–based bakery franchisor and receiving none of the promised support.
The core issue was whether the franchisor’s conduct violated franchise disclosure obligations and contractual duties under New York’s franchise laws.
Promises Made vs. Reality Delivered
During initial consultation calls, the franchisor claimed that:
A Franchise Fee of approximately $20,000 would secure the client’s right to open and operate under the brand.
The franchisor would supply key proprietary ingredients specifically specialty jam directly from its central facility.
Equipment purchases could be reduced because the franchisor would provide premade components.
Ongoing operational guidance would be provided.
Trusting these statements, the client paid the Franchise Fee and entered the franchise agreement.
However, once the store opened, the franchisor failed to provide training, ignored operational questions, and abruptly announced it would no longer supply jam rendering the store unable to operate as advertised.
Shortly thereafter, the franchisor declared it was “terminating” the agreement without cause.
Because the franchisor refused to return the Franchise Fee, the client sought legal assistance to demand repayment and pursue dispute-resolution avenues recognized in New York.
2. Franchise Fee New York – Legal Standards and Franchise Rights
In New York, franchise operators are protected by disclosure rules under the New York Franchise Sales Act, which requires franchisors to make truthful, complete representations regarding financial obligations, brand use, and support.
Misrepresentation related to a Franchise Fee can constitute an unlawful franchise sale, breach of contract, or deceptive business practice.
Franchise Misrepresentation and Contractual Breach
To establish wrongdoing in a Franchise Fee dispute, counsel focused on demonstrating:
The franchisor’s operational promises were material and induced the client to pay the fee.
The franchisor failed to provide support essential to the business model.
The unilateral termination lacked contractual or statutory grounds.
The brand symbols, packaging, signage, and coupons provided to the client clearly demonstrated the existence of a legitimate franchise relationship.
These factors strongly supported the claim that the Franchise Fee was wrongfully retained.
Franchise Dispute Resolution Options in New York
Like the Korean dispute-resolution model, New York franchise disputes may be handled through:
Formal demand letters, Mediation or arbitration (if required under the contract), Negotiated settlements, Litigation under New York General Business Law.
Here, counsel initiated dispute resolution through a formal notice and structured negotiation, providing the franchisor an opportunity to resolve the matter without litigation.
3. Franchise Fee New York – Legal Strategy and Advocacy
Our team prepared a detailed factual and legal foundation to support the client’s claim for a full refund of the Franchise Fee, documenting every instance of misrepresentation and breach.
Demand Letter and Evidence Submission
The attorney drafted a formal notice outlining the franchisor’s breaches:
The franchisor accepted the Franchise Fee and executed a franchise agreement.
The franchisor failed to provide required training, support, and supply.
The franchisor unilaterally announced termination.
The client purchased signage, packaging, and materials based on the franchisor’s approval.
The client incurred losses for signage removal and rebranding.
The letter demanded full refund of the Franchise Fee plus reimbursement for associated losses.
Rebutting the Franchisor’s Denial
When the franchisor attempted to deny that a franchise agreement existed, the attorney produced strong counter-evidence:
The client paid the Franchise Fee, acknowledged and invoiced by the franchisor.
The franchisor’s branding appeared on packaging, coupons, storefront signage, and uniform materials.
The franchisor exercised control over product type, quality, and methods establishing the legal definition of a franchise relationship.
The franchisor repeatedly instructed the client regarding product preparation and sales.
By demonstrating the existence of a franchise relationship under New York law, counsel solidified the basis for Franchise Fee recovery.
4. Franchise Fee New York – Final Resolution and Refund
After reviewing all submitted evidence, the dispute-resolution body recommended full repayment of the Franchise Fee.
Both parties accepted the proposed outcome, and the case closed successfully.
Refund of the Full Franchise Fee
The franchisor agreed to refund the entire Franchise Fee, resolving the dispute without litigation.
The client expressed significant relief, noting that without legal representation, it would have been nearly impossible to rebut the franchisor’s denial or navigate the dispute-resolution process.
How SJKP Can Assist in Franchise Disputes
SJKP represents franchisees across New York in matters involving Franchise Fee disputes, misrepresentation, wrongful termination, supply failures, and unfair trade practices.
Our team prepares comprehensive demand packages, negotiates with franchisors, and guides clients through formal dispute-resolution processes.
If you are facing a Franchise Fee conflict or believe your franchisor has breached its obligations, contact SJKP for tailored legal strategy and strong advocacy.
28 Nov, 2025
