Franchisors frequently claim trademark infringement when enforcing termination of franchise agreements. The defenses brought by franchisees in such cases can range from simple denials to complex counterclaims involving federal and state rules and legislation, common law contract claims and tort claims.
Freedom to contract allows the freedom to control or circumscribe the risk and amount of damages. In contrast, tort claims are limited only by foreseeability and proximate cause, and damages can exceed those in contract claims. Our jurisprudence limits tort claims where the parties sought to control their risks by contract. Deciding whether tort claims can be properly asserted in franchise dispute can be difficult.
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