Zeidler v A W Restaurants Inc 301 F3d 572 7th Cir 2002 a franchisees closing of

Zeidler v a w restaurants inc 301 f3d 572 7th cir

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Zeidler v. A & W Restaurants,  Inc.,   301 F.3d 572 (7th Cir. 2002) (a franchisee's closing of its restaurant barred it from establishing that the franchisor wrongfully terminated the franchise, even though  the  franchisee  asserted that the  franchisor  acted in bad faith by threatening  termination, because the franchisee could not show a link between the termination threats and the restaurant's closure and the voluntary abandonment of the franchise constituted good cause for the franchisor to terminate the agreement). Hale Trucks of Maryland, LLC v. Volvo Trucks North America, Inc.,   224 F.Supp.2d 1010 (D.Md. 2002) (a truck manufacturer was entitled to terminate a dealership agreement on fifteen days' notice after the dealer’s lender repossessed all of the dealer’s vehicles). Duarte & Witting, Inc. v. New Motor Vehicle Board,  104 Cal.App.4th 626, 128 Cal.Rptr.2d 501 (3 Dist. 2002) (in a Chrysler-Plymouth dealer’s suit against termination of its Plymouth franchise by Daimler   Chrysler   Motors   Corp.,   it   was   undisputed   that   the   franchisor   was   discontinuing   the manufacture of the product and the franchise agreement allowed for the termination of the franchise on
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144 INSTRUCTOR’S MANUAL TO ACCOMPANY WEST’S BUSINESS LAW, TENTH EDITION the discontinuation, and thus good cause for termination of the franchise existed as a matter of law). Midwest Automotive III, LLC v. Iowa Department of Transportation , 646 N.W.2d 417 (Iowa 2002) (a change in the ownership of a franchisee's auto dealership constituted good cause for the termination of the franchise when the majority of the dealership's new owner's customer satisfaction index scores were below average). T EACHING  S UGGESTIONS 1. Explain that creditors are often reluctant to permit the owner of a sole proprietorship to contract out of personal liability because the business assets may not satisfy all of the creditors’ claims if the debts are not paid. Many lenders insist that a sole proprietor sign a personal guaranty so that the lender will have recourse to his or her personal assets. 2. Sometimes, a franchisor appears to attempt to drive its franchisee out of business by establishing a competing business within the geographic market area.   Why would a franchisor attempt to drive its own franchisee out of business?   There are several possible reasons.  Perhaps the franchisor was not using good business judgment but only asserting its power.  Maybe the franchisor hoped to drive the higher priced restaurant out of business to make ultimately more profit in the lower priced restaurant.  Maybe the franchisor did not necessarily intend to drive the franchisee out of busi-
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