Penalties for Violating Franchise Laws

Article by: Lynne D. Shelton

The Federal Trade Commission (“FTC”) and the State agencies governing franchises take the hundreds of complaints they receive each year very seriously. Using the FTC Rule, courts have penalized Franchisors through civil fines, rescission, monetary damages, and personal liability for the owners of the franchisor. Civil fines have been levied for up to $11,000 per day, per violation. In one …