What constitutes 'competing with Counselor' in the context of the non-compete agreement for Counselor Realty?
Counselor_Realty Franchise · 2025 FDDAnswer from 2025 FDD Document
- (c) During the term of this Agreement, you will not own any interest in, or work for, engage in or assist, directly or indirectly, any real estate brokerage service business other than Counselor, or that competes with Counselor, at or within 50 miles of the Office (or any Additional Office or Extension Office) without Counselor's prior written approval.
- (d) During the term of this Agreement and for a period of twenty-four (24) months after it expires, is terminated or is transferred, you will not alone, or in any capacity
with another person or entity, within the United States and any other geographical area in which Counselor operates, solicit or cause to be solicited any person or entity that is (or was within the previous six (6) months) an agent, employee or independent contractor of Counselor or another Counselor franchisee, for the purpose of hiring or contracting such person or entity to work for you or any other party, or for the purpose of inducing them to leave such party's employment or contract with Counselor or another Counselor franchisee.
Source: Item 22 — CONTRACTS (FDD page 32)
What This Means (2025 FDD)
According to Counselor Realty's 2025 Franchise Disclosure Document, during the term of the Franchise Agreement, a franchisee is restricted from owning any interest in, working for, engaging in, or assisting any real estate brokerage service business other than Counselor Realty. This restriction applies to any business that competes with Counselor Realty within a 50-mile radius of the franchisee's office, including any Additional Office or Extension Office, unless the franchisee obtains prior written approval from Counselor Realty. This clause aims to protect Counselor Realty's market share and prevent franchisees from using the franchisor's resources and knowledge to benefit a competing business.
After the Franchise Agreement expires, is terminated, or is transferred, the franchisee is restricted for a period of 24 months. During this time, the franchisee cannot solicit any person or entity that is (or was within the previous six months) an agent, employee, or independent contractor of Counselor Realty or another Counselor Realty franchisee. This restriction applies within the United States and any other geographical area in which Counselor Realty operates. The purpose of this clause is to prevent franchisees from poaching Counselor Realty's personnel to work for a competing business, thereby protecting Counselor Realty's workforce and franchisee network.
In practical terms, a prospective Counselor Realty franchisee should understand that they cannot operate a competing real estate business or be involved with a competitor during the term of their agreement and within a 50-mile radius of their office without explicit permission. Furthermore, for two years after leaving the Counselor Realty system, they are prohibited from actively recruiting Counselor Realty's agents, employees, or independent contractors. These restrictions are designed to safeguard Counselor Realty's business interests and maintain the integrity of its franchise network.