BLS 112 Chapter Notes - Chapter 36: Capital Structure, Respondeat Superior, Federal Trade Commission

• School: Binghamton University
• Department: Business Law and Society
• Course: BLS 112
• Professor: S U N Y Ulster

Document Summary

Chapter 36: sole proprietorships and franchises: sole proprietorships. Sole proprietorship: simplest form of business; one owner does business without creating separate business organization. Franchise: owner of intellectual property (trademark, trade name, copyright) licenses others to use it in selling of goods or services: franchisee (purchaser of franchise) is legally independent but economically dependent from franchisor (seller of franchise) Types of franchises: distributorship: manufacturer (franchisor) licenses a dealer (franchisee) to sell its product, covers exclusive territory, ex. Mcdonalds, 7-eleven, holiday inn: manufacturing arrangement (processing-plant arrangement): franchisor transmits to franchisee the essential ingredients to make product; franchisee markets product at wholesale or retail according to franchisor"s standards, ex. Laws governing franchising: governed by contract law, federal regulation. Industry-specific standards: protect franchisee from unreasonable demands & bad faith terminations by franchisor, automobile franchisor cannot make unreasonably high seals quota. Grounds for termination set by franchise contract: termination must be for cause , ex.