Louise Feldspar obtained the exclusive right to sell TastyCrunchy Chicken in a specified area. Under the agreement, Feldspar was permitted to use the TastyCrunchy name and logo for her restaurant and she agreed to comply with TastyCrunchy's restaurant

requirements. She purchased her equipment, as well as the chicken she served, from the firm. She agreed to devote a certain percentage of her revenues to promoting the TastyCrunchy operation in local media. The operation was successful from the start, and Feldspar has had no problem meeting the sales quotas imposed by TastyCrunchy. The past year TastyCrunchy informed Feldspar that it intended to open a new restaurant on an interstate highway that had just been completed in her exclusive area of trade. Because her operation would be competition for the new store, Feldspar's right to sell TastyCrunchy products and use the name TastyCrunchy was revoked. What can Louise do?


Feldspar was operating under a franchise agreement that gave her the exclusive right to the area in question. She should immediately examine the terms of the franchise agreement to make sure that she has not committed any violations of the franchise requirements that would justify the cancellation. If no justification for termination exists, Feldspar should take action against TastyCrunchy for bad faith termination of her franchise.

Business

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