Is Management Recruiters required to post a bond to obtain injunctive relief against a franchisee?
Management_Recruiters Franchise · 2024 FDDAnswer from 2024 FDD Document
Strikes, inadequate supply of equipment, merchandise, supplies, material or energy, or the voluntary foregoing of the right to acquire or use any of these in order to accommodate or comply with orders, requests, regulations, recommendations or instructions of any government, government department or government agency;
- Compliance with any Law, rule, order, regulation, requirement or instruction of a government agency other than an order, requirement or instruction that arises from a violation of Law or this Agreement;
- Acts of God, acts of the public enemy, acts of terrorism, or societal disruptions caused by terrorism or civil unrest; or
- Acts or omissions of the other party.
- 22.5. Specific Performance and Injunctive Relief. Nothing in this Agreement shall prevent Franchisor or Franchisee from obtaining specific performance of this Agreement and injunctive relief against threatened conduct that will cause loss or damages, under equity rules, including applicable rules for obtaining restraining orders and preliminary injunctions. Franchisor shall be entitled to injunctive relief without bond but upon due notice, in addition to all further and other relief available at law or equity. Franchisee's sole remedy upon entry of any injunction shall be dissolution of the injunction, if warranted, upon hearing.
- **22.6.
Source: Item 23 — RECEIPTS (FDD pages 67–327)
What This Means (2024 FDD)
According to Management Recruiters' 2024 Franchise Disclosure Document, Management Recruiters is generally entitled to injunctive relief without posting a bond, provided they give due notice to the franchisee. This means that Management Recruiters can seek a court order to stop a franchisee from engaging in certain conduct that Management Recruiters believes is harmful, without having to put up a sum of money as security. The franchisee's only recourse if an injunction is issued is to attempt to have the injunction dissolved at a hearing.
However, there is an exception to this general rule for franchisees operating in Minnesota. For these franchisees, it will be up to the court to determine whether Management Recruiters must post a bond to obtain injunctive relief. This means that a Minnesota franchisee might have additional protection against potentially unwarranted injunctions, as the court will assess the need for a bond on a case-by-case basis.
This difference highlights the importance of understanding the specific laws and regulations that govern franchising in the state where the franchise will operate. Prospective Management Recruiters franchisees should carefully review the FDD and consult with an attorney to fully understand their rights and obligations, particularly regarding dispute resolution and injunctive relief.