I purchased a franchise from a company in Iowa to run arm wrestling tournaments in the state of Kansas in 1987. The franchisee received an arm wrestling machine and a certain designated area for the tournaments. I purchased five franchises for the whole State of Kansas. This Franchise company went bankrupt in 1989, leaving all of the 36 franchisees across the country high and dry.
It has come to my attention that the person that owned the franchise company has started up a new company in 2003 selling franchises again with about the same machine and the exact same marketing plan.
My question is, is it legal for him to sell franchises again under a different company name and a different machine name to the same areas again, fifteen years later? Is this violating my rights or going against any bankruptcy laws or franchise laws?
I also found out that he had sold more arm wrestling franchises in the early 1980's in these same areas with a different machine.
1 Answer from Attorneys
Like many questions, yours does not have sufficient facts to provide an accurate answer. First, does the machine have any unique patentable or proprietary rights? What are your contractual rights? Did he own the rights? Did the trustee abandon the property rights during the bankruptcy? etc? Lots of questions, I suggest you consult a lawyer personally.
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