No formula change, but further development by the franchisor
The District Court of Maastricht ruled on 6 October 2022, ECLI:NL:RBLIM:2022:7655, on whether the franchisor can close a franchisee’s website if the franchisee does not accept a change in the policy. The franchisor also indicates that it will suspend the continued payment of monies collected by customers of the franchisee.
The preliminary relief judge ruled that the franchisor did not act contrary to the franchise agreement by prescribing that from now on only one permanent lead generator may be used. The claim to put the website on which the leads come in online again, so that the lead generation can be continued by another lead generator, is therefore rejected.
In addition, the franchisee claimed an injunction against suspension of the continued payment of monies collected by the franchisee’s customers. The franchisee engaged in marketing activities on the Internet without the necessary consent of the franchisor, had changed control of the franchise business and violated the franchisor’s contractual pre-emption right. The franchisee then argued that the unwanted marketing activities should be discontinued and that the contractual pre-emption right should still be fulfilled. The franchisor had announced that if the franchisee had not complied with the summons, it would not pass on the monies of the franchisee’s customers to the franchisee. The preliminary relief judge rejected the franchisor’s prohibition on suspension. After all, there was no question of any actual suspension (yet).
The preliminary relief judge did not rule that there had been a formula change, but was apparently of the opinion that there was a further development to which the franchisee had to conform. It is conceivable that if the franchisee does not comply with this, suspension of the franchisee’s assets could be permitted.
Ludwig & Van Dam lawyers, franchise legal advice.
Do you want to respond? Then email to ludwig@ludwigvandam.nl
Other messages
Legal Franchise Statistics 2019: slight decrease in number of franchise disputes
In 2018, 44 judgments were published on Rechtspraak.nl, 12 of which were appeal cases and one in cassation (a prognosis issue against Albert Heijn).
Article De Nationale Franchisegids: “Judge again rules in favor of Domino’s franchisees” – dated September 3, 2019 – mr. RCWL Albers
At the beginning of 2018, almost all franchisees of Domino's and the Association of Domino's Pizza Franchisees submitted two issues to the court in Rotterdam.
Article De Nationale Franchisegids: “The interim termination of the franchise agreement” – August 12, 2019 – mr. JAJ Devilee
A franchise agreement can end prematurely in many ways.
Article De Nationale Franchise Gids: “Parliamentary questions asked about (false) self-employment franchisees” – dated 24 July 2019 – mr. M. Munnik
Parliamentary questions have recently been asked about the so-called bogus self-employment within the relationship between franchisor and franchisee.
Article Franchise+: “With our franchise formula you will earn mountains of gold.” dated 10 July 2019 – mr. AW Dolphin
The distinction between permissible promotions and misleading information remains a gray area, despite the relevant legislation.
Franchisee may purchase a range of foreign products after mandatory formula change – June 6, 2019 – mr. JAJ Devilee
The District Court of East Brabant recently dealt with an important matter in preliminary relief proceedings in which a franchisee was completely involuntarily forced to adopt an alternative formula.