The New Jersey Franchise Practices Act prohibits termination or non-renewal of a defined franchise except for good cause, which is defined by the failure of a franchisee to perform the material obligations of the franchise agreement. Because the act basically requires material breach for termination or non-renewal, many of the disputes in franchise cases under the act challenge the existence of a franchise as defined by the act. In the recent case of McPeak v. S-L Distribution, 2012 U.S. Dist. LEXIS 17983 (D. NJ), the district court determined that Joseph A. McPeak failed to plead facts sufficient to establish that S-L granted a trademark license necessary to sustain a cause of action under the act.
Pursuant to a 2006 distributorship agreement, McPeak was granted an exclusive right to sell and distribute certain products within a geographic region of Southern New Jersey. The agreement disclaimed the existence of a franchise or a marketing system and characterized McPeak as an independent contractor. The agreement prohibited the conduct of business under the defendants name or under the trade name or trademarks of any of the products, absent written consent. The agreement required McPeak to use best efforts to sell products, comply with the standard operating guidelines, develop new accounts and to establish and maintain the good will of the products.
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.
For questions call 1-877-256-2472 or contact us at [email protected]
