Legal Question in Business Law in Texas

I paid over $50,0000 for a franchise that was never delivered by the franchisor. They still do not have 2008 audited financial statements, a current FDD, or current franchise agreement. They have been saying it will be "2 weeks" since April 2009. Meanwhile, they have kept all of our money and used it to develop a new/improved franchise model. I took out loans to buy the franchise and am paying interest for almost a year now. Have been told it would cost $200,000 to file a class action suit and we would have difficulty collecting anything. Are there any regulatory agencies that can help with franchisor fraud, misrepresentation, deceptive trade practices, breach of contract, theft, gross neglicence of fiduciary responsibilities, etc?? I can't afford to sue them - they stole all my money!


Asked on 3/13/10, 4:07 pm

2 Answers from Attorneys
David Leon David L. Leon, P.C.

You shouldn't have been charged any fees like this before being given an FDD. Where is the franchise located?

Dave

http://leonlaw.com/askalawyer

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Answered on 3/18/10, 8:22 pm
Kevin B. Murphy Franchise Foundations, APC

If they collected money from you before providing their current FDD and allowing you to review it for 14 calendar days beforehand, they have violated federal and applicable state franchise laws. You should contact an attorney ASAP. He or she may be able to get your money back based on a well-written demand letter.

Kevin B. Murphy, B.S., M.B.A., J.D. - Mr. Franchise

Franchise Attorney

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Answered on 3/25/10, 10:05 am


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