A franchisor and franchisee who use the same trade name and trademarks and make no effort to inform the public of their separate legal status may find themselves in an "apparent agency" situation.

Question

Quizplus · Accepted Answer

By using the same trade name and trademarks without informing the public of their separate legal status, a franchisor and franchisee may create the appearance of a joint venture or agency relationship, even if none exists in reality. This can create legal liability and confusion for both parties.

A Franchisor and Franchisee Who Use the Same Trade Name