In the world of franchising, many times lines get blurred when looking at the roles certain people play. One of those blurred lines is that of the role of a franchise developer versus a franchise lawyer.
Both a franchise developer and a franchise lawyer participate in the creation of a franchise brand; however, the difference between the two is the license to practice law and legally acknowledge that the franchise disclosure document is compliant with federal and state law.
Franchise lawyers have experience in franchising. They have worked with several franchisors and franchisees and have the knowledge to ensure that franchise disclosure documents and franchise agreements are properly written and in compliance with the Federal Trade Commission’s franchise rule and, if necessary, state specific regulations.
Although many franchise developers have decades of experience, these individuals typically are not licensed in any state to practice franchise law. Therefore, they are not permitted to write franchise disclosure documents or franchise agreements without risking legal liability for the unauthorized practice of law. Most franchise developers have close working relationships with franchise lawyers. Still, developers make sure that all legal work is performed exclusively by the franchise lawyer.
This is not to say that a franchise developer is not a good partner to have when franchising a business. A good franchise developer can be a great resource for strategizing on territories, names, operations manuals, training curriculums, and other important parts of the business. However, drafting the franchise disclosure document and franchise agreement should be left to an attorney.
Our lawyers personally know several franchise developers that are worth talking to and working with to help coach franchisors through the franchise development, creation, and sales process. However, these franchise developers know and respect the fine line between development and practicing law. If you are in need of franchise legal work or a franchise development contact, please reach out to our firm today.