What are the consequences for a C12 Group franchisee who engages in 'poaching'?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Non-Solicitation of Members. Franchisee agrees to not purposely solicit (either directly or indirectly) any prospective C12 member who lives and works in the territory of another C12 franchisee. Such 'poaching' is deemed by C12 to be a material breach of this Agreement that strikes at the unity of the C12 franchise system and is grounds for termination upon notice to Franchisee. If one of Franchisee's C12 members desires, for any reason, to consider becoming a member of a Business Forum in another C12 franchisee's territory and personally initiates a request to transfer their membership to another group, Franchisee shall enable the member to attend a full meeting in the other group (presuming room exists for their potential membership) before they reach a final decision. This C12 policy is aimed at serving the best
interests of each member and is ultimately deemed as the best policy for C12 franchisees. In such a scenario, Franchisee agrees that there will be no compensation to either Franchisee or the other C12 franchisee as a result of a member choosing to make such a transfer.
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to the 2025 C12 Group Franchise Disclosure Document, 'poaching,' defined as purposely soliciting prospective C12 Group members who live and work in another franchisee's territory, is considered a material breach of the franchise agreement. This breach strikes at the unity of the C12 Group franchise system.
The consequence for a C12 Group franchisee who engages in such 'poaching' is termination of the franchise agreement. The franchisor can terminate the agreement upon notice to the franchisee.
However, the FDD also outlines a specific exception: if a C12 Group member independently seeks to transfer their membership to a forum in another franchisee's territory, the original franchisee must allow the member to attend a meeting in the other group, assuming there is space available. In this scenario, neither franchisee receives compensation as a result of the member's transfer. This policy is in place to serve the best interests of the members and is deemed the best policy for C12 Group franchisees.