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Nissan Involved In Florida Franchise Law Dispute

According to a story recently posted by Autonews.com, the Japanese automaker Nissan is currently involved a franchise law dispute with some of its Florida franchisees. The dispute stems from Nissan’s offer of cash based support to a specific franchise location. Other Florida Nissan franchisees believe that they are legally entitled to the same financial support. If your business is currently involved in a Florida franchise dispute, please contact an experienced West Palm Beach franchise law attorney for immediate legal assistance.

The Origins of the Dispute

For Nissan, the issue began when territory for a new franchise location became available in Coral Gables, Florida. The corporate officers at Nissan wanted to give that specific franchise location some additional financial support. According to the reporting, Nissan believed that this additional support would be necessary to help the Coral Gables location turn into a sustainable and profitable business. Nissan’s plan involved two types of specialized financial support. First, Nissan would give the Coral Gables spot some extra cash upfront, in order to get the location off the ground. Further, for at least seven years, Nissan would provide this location with extra sales incentives. If the Coral Gables location hit the sales targets in a given month, that franchisee would get an additional bonus payment from Nissan. None of this additional financial support has been offered to other Florida Nissan franchise locations. The owners of the other locations have argued that this arrangement is a violation of Florida franchise law.

Why This Arrangement Might Violate Florida Franchise Law

Nissan, as the franchisor, has legal obligations under the Florida Franchise Act. A separate Florida Nissan franchise, located in Palmetto Bay, is the lead party in lawsuit against the corporate office. The lawsuit alleges that Nissan’s deal violates the Franchise Act. Specifically, the complaint points to a provision in the act that prohibits franchisors from favoring anyone franchise location over the others. Since the new Coral Gables Nissan location has been offered additional support and incentives, the other Nissan franchise owners believe that Nissan is unlawfully favoring that location. The owner of the Coral Gables location has responded by stating that he was not giving any unfair advantage. He claims that Nissan only offered him a unique incentive structure because the costs associated with operating at that specific location are not directly comparable to the costs of operating a Nissan franchise around the rest of the state. The court will have to consider whether Nissan’s actions actually constitute unlawfully favoring one franchisee, or if they have properly tailored the incentives to adjust for locations unique issues, thereby merely giving the Coral Gables franchise a fair shot at success.

Contact An Experienced West Palm Beach Franchise Law Attorney

At Pike & Lustig, LLP our business litigation attorneys have extensive experience handling all sides of Florida franchise law cases. We understand how important your investment is, and we will work tirelessly to fight for your legal rights. If you are involved in a Florida franchise disagreement, either as a franchisor or a franchisee, contact our West Palm Beach office today to schedule a free case evaluation. We proudly represent clients throughout South Florida.

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