A “franchisor” is a company or person that allows a third party to do business under the franchisor’s marks, but the franchisor doesn’t own or operate the third party’s location, itself. The “franchisee” is the third-party doing business under the franchisor’s name. Common examples of franchises include McDonald’s, Domino’s Pizza, Subway, Chick-fil-A and the like where site locations are not themselves owned or operated by the franchisor. These relationships generally arise by virtue of franchise agreements that govern the relationship between the franchisor and franchisee which generally include how the franchisor’s marks can be used, how much has to be paid to the franchisor company for the rights to operate a franchise location, as well as how the franchisee should operate.
Consider this: you are involved in a motor vehicle accident with a pizza delivery driver who was at fault. In most circumstances when you are injured by an employee while working within the scope of their duties, you can also hold the employer vicariously liable for your injury. In this hypothetical, you can hold the pizza shop liable for injuries caused by its employee, but can you hold the franchisor company liable too? If so, you may stand to recover more in compensation for your injury due to the availability of an additional, and often deeper, pocket.
In Florida, “a franchisor may be held vicariously liable under an agency theory for the tortious acts of a franchisee, or a franchisee’s employee, when the franchisor has direct control of, or the right to control, the day-to-day operations of the franchisee.” Domino’s Pizza, LLC v. Weiderhold, 248 So.3d 212, 222 (Fla. 5th DCA 2018). What amounts to “direct control of, or the right to control, the day-to-day operations of the franchisee” is determined on a case-by-case basis; however, in the Domino’s case, the court determined that Domino’s Pizza had sufficient control over the franchisee location such that a jury could subject it to liability for the negligence of the delivery driver.
Whether you can recover from a franchisor for the negligence of a franchisee or its employee(s) is a complex and usually vigorously litigated matter, for which you should strongly consider engaging the services of an attorney with experience in such cases.