1. Franchise Litigation in New York – Client Background and Unfair Franchise Inducement
Our Franchise Litigation team first reviewed the client’s relationship with the franchisor and the circumstances that led to the initial fee payment.
In New York, franchise sellers must provide accurate disclosures before accepting funds or signing agreements. This legal context shaped our early analysis.
Client’s Entry Into the Franchise System
The client entered the restaurant franchise after being assured of proprietary recipes, proven operational systems, and detailed management guidance.
Despite paying the initial franchise fee, the client received only minimal introductory training and no meaningful instruction regarding the brand’s core methods.
Because the franchisor withheld essential training, our Franchise Litigation analysis suggested misrepresentation and non-compliance with disclosure laws.
Failure to Provide Mandatory Franchise Disclosures
Under the New York Franchise Sales Act (NY Gen. Bus. Law §§ 680–695) and the FTC Franchise Rule, franchisors must provide a compliant Franchise Disclosure Document (FDD) at least 14 days before accepting money or signing an agreement.
Here, the franchisor provided no disclosures at all.
This failure strengthened the client’s Franchise Litigation position, as nondisclosure permits rescission and refund of all payments under New York law.
2. Franchise Litigation in New York – Key Legal Framework Under NYFSA and Federal Law
To establish the client’s right to recover the franchise fee, our firm relied on core statutory requirements applicable to Franchise Litigation actions in New York.
Disclosure Obligations Under New York Law
New York requires franchisors to:
• Register the franchise with the NY Attorney General
• Provide a compliant FDD
• Disclose nearby franchise locations
• Deliver accurate financial and operational information
The franchisor here violated all four obligations.
Such violations directly support rescission in Franchise Litigation and allow franchisees to pursue full fee reimbursement.
Misrepresentation and Material Omissions
The franchisor exaggerated claims about exclusive recipes, proprietary systems, and unique training methods.
When these statements proved false, they became actionable misrepresentations under state and federal law.
These findings reinforced the Franchise Litigation claims and established grounds for a full refund.
3. Franchise Litigation in New York – Litigation Strategy and Evidence Development
After confirming multiple statutory violations, our team built a structured evidentiary record focusing on the franchisor’s misleading conduct and the absence of required disclosures.
Evidence of Disclosure Violations
Our attorneys gathered and analyzed:
• Franchise agreement
• Payment receipts
• Email correspondence
• Training logs
• Website marketing statements
These documents showed the franchisor accepted money before providing an FDD, failed to register the offering, and failed to disclose nearby locations.
All of this strengthened the Franchise Litigation claim.
Evidence of Misrepresentation and Lack of Support
The franchisor promised specialized training and operational systems but delivered none.
This stark discrepancy demonstrated material misrepresentation, an independent basis for rescission under New York’s Franchise Sales Act.
4. Franchise Litigation in New York – Outcome: Full Recovery of the Franchise Fee
After presenting detailed legal arguments supported by statutory authority, the court accepted our position and awarded the client the full initial franchise fee.
This outcome shows how powerful Franchise Litigation remedies can be when franchisors disregard disclosure laws.
Importance of Legal Representation in Franchise Disputes
This case underscores that successful Franchise Litigation requires deep understanding of disclosure regulations, contractual duties, and misrepresentation doctrines.
With proper legal strategy, franchisees can obtain rescission, compensation, and protection from unfair practices.
SJKP assists franchisees and franchisors in disputes involving disclosure failures, rescission, misrepresentation, and contract breaches.
Our Franchise Litigation team conducts detailed document reviews, builds evidentiary strategies, and represents clients in negotiations and litigation.
If you face a franchise dispute, contact SJKP for comprehensive support.
27 Nov, 2025
