Franchise and Distribution Litigation

Our franchise and distribution team has substantial experience and a track record of success in addressing the rights and obligations of suppliers, manufacturers and franchisors, including the protection of their distribution strategies, systems, trademarks, service marks and trade dress. Our litigators have represented major distribution and franchise systems in counseling and litigating a broad range of issues within the consumer and industrial products, hospitality, food and beverage, and real estate industries. Whether we are advising them on terminations, restructuring or other system changes, enforcing their contract rights, protecting their intellectual property, or defending them against individual or class action claims, we offer deep experience in distribution and franchise issues as well as trial advocacy.

We bring substantial efficiencies to regional and national representation of a distribution or franchise system, as well as the depth of resources necessary to address a "bet the company" challenge. Our work for clients on distribution and franchise matters has resulted in favorable verdicts, judgments and arbitration awards in cases litigated across the country, on a wide variety of claims with system-wide implications.

We have represented a major soft drink supplier, for example, for almost two decades in helping resolve disputes with its bottler system. In Illinois, our efforts have included a successful constitutional challenge to the "Soft Drink Industry Fair Dealing Act," an expansive bottler protection legislation that otherwise would have dramatically altered the contract rights and obligations of soft drink concentrate suppliers and their bottlers.

We also serve as regional counsel for nationally-known franchisors, and have obtained preliminary and permanent injunctions, summary judgments and other rulings to protect their franchise systems from unauthorized use of their marks by former franchisees or unauthorized transferees.

We offer valuable guidance to our clients in the pre-litigation stages as well, with substantial experience in negotiating and preparing distribution agreements, providing advice on issues that arise in the operation of distribution systems, and planning for disputes that may arise with current and former distributors, franchisees, dealers and sales representatives.

Many on our team have held leadership positions with organizations like the ABA Forum on Franchising. Our lawyers have served on the Governing Committee, Litigation and Dispute Resolution Steering Committee, and Publications Committee for the ABA Forum, and have written and held editorial positions with the Franchise Law Journal and The Franchise Lawyer. Members of the Schiff Hardin franchise and distribution law group write and speak regularly on franchise and distribution topics at conferences sponsored by the ABA, the International Franchise Association, and other major franchise and distribution groups and associations.

Schiff Hardin's representative franchise and distribution cases include:

Ramada Worldwide Inc. v. Homewood Hotel, Inc. (N.D. Illinois 2007) — summary judgment in favor of our franchisor client on its trademark infringement, breach of contract and other claims against a former franchisee and its guarantors.
Schwab Realty Ltd. v. Coldwell Banker Real Estate Corporation (Winnebago Co., Wisconsin 2005) — franchisee statutory, contract and fraud claims of encroachment dismissed with prejudice upon successful motion to dismiss.
PepsiCo, Inc. v. Marion Pepsi-Cola Bottling Company (S.D. Illinois 2003) — successful summary judgment holding that so-called Illinois Soft Drink Industry Fair Dealing Act, lobbied for by an underperforming bottler, was unconstitutional, leading to repeal by Illinois legislature.
Howard Johnson Int’l v. Ariff (C.D. Illinois 2003) — summary judgment in favor of franchisor on all claims, including contract and veil piercing claims, against former franchisee and its alter egos.
Travelodge Hotels Inc. v. People’s Hospitality (N.D. Illinois 2003) — summary judgment in favor of franchisor against substandard, holdover franchisee.
Bunn-O-Matic Corporation v. Bunn Coffee Services, Inc. (C.D. Illinois 2000) — Summary judgment permanently enjoining a former dealer-licensee from infringing our client’s trademark.
Howe Corporation v. Scotsman (American Arbitration Association 2000), worldwide distributor dispute presenting tort, contract and antitrust claims, tried for three weeks before the Hon. Richard Curry, Chicago, acting as AAA arbitrator (affirmed by Cook County Circuit Court and Illinois Appellate Court).
Jerry Martin Associates Inc. v. Thermos (D. South Carolina 1997) (defended client against legal and equitable claims brought by former sales representative; claims resolved by settlement reached during course of jury trial).
Bratton v. Safeguard Business Systems, et al. (Riverside Co., California 1996) — Six-week jury trial of distributor claims, including breach of contract, tort allegations, and antitrust claim, favorable verdict May 1996, before the Hon. Charles Fields.
Safeguard Business Systems, Inc. v. Reed-Rite (N.D. Illinois 1995) — Bench trial of trademark infringement and commercial breach, judgment 1995 by the Hon. Ruben Castillo.