Fact Pattern 31-1
Jumbo Juice Inc. offers entrepreneurs the opportunity to operate a franchise under the Jumbo Juice trade name as a member of a select group of dealers that engage in retail juice sales.
-Refer to Fact Pattern 31-1. Jumbo Juice makes earnings claims to potential investors. For those claims, the franchisor must have

Question

Fact Pattern 31-1 
Jumbo Juice Inc. offers entrepreneurs the opportunity to operate a franchise under the Jumbo Juice trade name as a member of a select group of dealers that engage in retail juice sales.
-Refer to Fact Pattern 31-1. Jumbo Juice makes earnings claims to potential investors. For those claims, the franchisor must have

Quizplus · Accepted Answer

Jumbo Juice must have a reasonable basis for any earnings claims that they make to potential investors. This means that the claims must be based on facts or data that can be verified and that a reasonable person would believe support the claim. A hypothetical basis or no basis would not be sufficient. An actual basis may be more than is required, as long as the basis is reasonable.