ABSTRACT
Franchising serves as one of the most popular forms of owning and operating a business. As the franchise model has grown, so too have issues in vicarious liability. Over the years, multiple methods of allocating the blame to franchisors have developed, such as through statutory construction or the emergence of vicarious liability in the common law. With legal classification and the level of control of the utmost importance, franchisors tread lightly in establishing oversight procedures that do not cross over into control of day-to-day operations.
Traditional tests for vicarious liability assess the level of control a franchisor may exercise over a franchisee and whether the entity benefitted from the actions that caused the harm. Other approaches have potentially expanded vicarious liability beyond the agency context. While franchisors try to disclaim their liability, efforts have emerged to hold trademark owners liable for the unfettered use of their marks by a franchisee or licensee …
Emerson, Robert W, Franchisors in a Jam: Vicarious Liability and Spreading the Blame, 47(3) Journal of Corporation Law 571-626 (2022).
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