Franchisors: Avoid the Costly Mistake of a False or Misleading Franchise Advertisement
For Franchisors, when the time comes to market and advertise the sale of your franchise opportunity, one critical mistake to avoid exists in the violation of state specific franchise advertising regulations. In many instances, franchise sales advertising found to be "false or misleading" may result in the revocation of your right to sell franchises.
A false or misleading franchise advertisement is any advertisement that contains or implies information, including sales expectations and profits that are untruthful or may lead a prospective franchisee to a false expectation about the franchise.
Franchisors must be aware that the rules and potential consequences of false advertisement vary from state-to-state. For example, certain states may revoke the franchisors right to advertise franchise sales in that state.
When offering a franchise by way of published advertisement it is critical to stick to a thorough compliance program to ensure that your advertisements do not inadvertently trigger unnecessary state revocations or legal claims. Work with your franchise counsel to establish a balanced program that allows your "sales staff" to promote your system while avoiding unnecessary violations.
For additional information about starting a franchise or improving your franchise practices request a complimentary copy of "The Franchise Formula: A Guide to Franchising Your Business in the New Economy" by Charles N. Internicola or contact our franchise law office at 1-800-976-4904.
IMPORTANT DISCLAIMER: The information contained on this website is provided for general educational purposes only, should not be relied on as legal advice and does not serve to create an attorney client relationship. In utilizing this website you acknowledge that there is no attorney client relationship between you
and Charles N. Internicola, Esq. and that the information contained on this site does not and cannot serve as a replacement for the competent legal advice of a licensed attorney in your state. Further you acknowledge that any and all citations to cases and statutes must be independently verified by competent legal counsel to confirm the validity and accuracy of such information. The content of this site is subject to the Copyright of its author and owner, Charles N. Internicola, Esq.
