Franchisor's use of RICO: the best defense might be a good offense
Article Abstract:
Franchisors can invoke RICO when entering into civil actions against franchises that have disrupted the franchise system. Franchisors are often accused of RICO violations by their franchises and should be familiar with the act for this reason as well. Proof of a RICO violation requires properly pleading a cause of action and finding sufficient grounds to bring the action. Because RICO cases can result in huge remedies, the threat of a RICO suit can convince many franchisees to resist the temptation to take action against the franchisor.
Publication Name: Franchise Law Journal
Subject: Law
ISSN: 8756-7962
Year: 1993
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Duty of good faith and fair dealing
Article Abstract:
The 1996 Bronx Auto Mall decision exemplified a franchisee's successful efforts in proving a franchisor's breach of implied good faith duty. Franchise terminations and nonrenewals, as well as other issues concerning franchisee rights, have been successfully challenged under the implied duty of good faith and fair dealing. However, in the 1996 VICORP case, the court sided with the franchisor on this issue.
Publication Name: Franchise Law Journal
Subject: Law
ISSN: 8756-7962
Year: 1997
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RICO
Article Abstract:
A 1996 court decision in a case involving the Rolls-Royce company held the automobile company franchisor could not allege RICO (Racketeer Influenced and Corrupt Organizations Act) violations against one of its dealers. According to the court, the franchisor failed to produce convincing evidence of a pattern of racketeering or continuity, elements necessary to support RICO allegations.
Publication Name: Franchise Law Journal
Subject: Law
ISSN: 8756-7962
Year: 1997
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