§ 2805. — Enforcement provisions.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 15USC2805]
TITLE 15--COMMERCE AND TRADE
CHAPTER 55--PETROLEUM MARKETING PRACTICES
SUBCHAPTER I--FRANCHISE PROTECTION
Sec. 2805. Enforcement provisions
(a) Maintenance of civil action by franchisee against franchisor;
jurisdiction and venue; time for commencement of action
If a franchisor fails to comply with the requirements of section
2802 or 2803 of this title, the franchisee may maintain a civil action
against such franchisor. Such action may be brought, without regard to
the amount in controversy, in the district court of the United States in
any judicial district in which the principal place of business of such
franchisor is located or in which such franchisee is doing business,
except that no such action may be maintained unless commenced within 1
year after the later of--
(1) the date of termination of the franchise or nonrenewal of
the franchise relationship; or
(2) the date the franchisor fails to comply with the
requirements of section 2802 or 2803 of this title.
(b) Equitable relief by court; bond requirements; grounds for
nonexercise of court's equitable powers
(1) In any action under subsection (a) of this section, the court
shall grant such equitable relief as the court determines is necessary
to remedy the effects of any failure to comply with the requirements of
section 2802 or 2803 of this title, including declaratory judgment,
mandatory or prohibitive injunctive relief, and interim equitable
relief.
(2) Except as provided in paragraph (3), in any action under
subsection (a) of this section, the court shall grant a preliminary
injunction if--
(A) the franchisee shows--
(i) the franchise of which he is a party has been terminated
or the franchise relationship of which he is a party has not
been renewed, and
(ii) there exist sufficiently serious questions going to the
merits to make such questions a fair ground for litigation; and
(B) the court determines that, on balance, the hardships imposed
upon the franchisor by the issuance of such preliminary injunctive
relief will be less than the hardship which would be imposed upon
such franchisee if such preliminary injunctive relief were not
granted.
(3) Nothing in this subsection prevents any court from requiring the
franchisee in any action under subsection (a) of this section to post a
bond, in an amount established by the court, prior to the issuance or
continuation of any equitable relief.
(4) In any action under subsection (a) of this section, the court
need not exercise its equity powers to compel continuation or renewal of
the franchise relationship if such action was commenced--
(A) more than 90 days after the date on which notification
pursuant to section 2804(a) of this title was posted or personally
delivered to the franchisee;
(B) more than 180 days after the date on which notification
pursuant to section 2804(b)(2) of this title was posted or
personally delivered to the franchisee; or
(C) more than 30 days after the date on which the termination of
such franchise or the nonrenewal of such franchise relationship
takes effect if less than 90 days notification was provided pursuant
to section 2804(b)(1) of this title.
(c) Burden of proof; burden of going forward with evidence
In any action under subsection (a) of this section, the franchisee
shall have the burden of proving the termination of the franchise or the
nonrenewal of the franchise relationship. The franchisor shall bear the
burden of going forward with evidence to establish as an affirmative
defense that such termination or nonrenewal was permitted under section
2802(b) or 2803 of this title, and, if applicable, that such franchisor
complied with the requirements of section 2802(d) of this title.
(d) Actual and exemplary damages and attorney and expert witness fees to
franchisee; determination by court of right to exemplary damages
and amount; attorney and expert witness fees to franchisor for
frivolous actions
(1) If the franchisee prevails in any action under subsection (a) of
this section, such franchisee shall be entitled--
(A) consistent with the Federal Rules of Civil Procedure, to
actual damages;
(B) in the case of any such action which is based upon conduct
of the franchisor which was in willful disregard of the requirements
of section 2802 or 2803 of this title, or the rights of the
franchisee thereunder, to exemplary damages, where appropriate; and
(C) to reasonable attorney and expert witness fees to be paid by
the franchisor, unless the court determines that only nominal
damages are to be awarded to such franchisee, in which case the
court, in its discretion, need not direct that such fees be paid by
the franchisor.
(2) The question of whether to award exemplary damages and the
amount of any such award shall be determined by the court and not by a
jury.
(3) In any action under subsection (a) of this section, the court
may, in its discretion, direct that reasonable attorney and expert
witness fees be paid by the franchisee if the court finds that such
action is frivolous.
(e) Discretionary power of court to compel continuation or renewal of
franchise relationship; grounds for noncompulsion; right of
franchisee to actual damages and attorney and expert witness
fees unaffected
(1) In any action under subsection (a) of this section with respect
to a failure of a franchisor to renew a franchise relationship in
compliance with the requirements of section 2802 of this title, the
court may not compel a continuation or renewal of the franchise
relationship if the franchisor demonstrates to the satisfaction of the
court that--
(A) the basis for such nonrenewal is a determination made by the
franchisor in good faith and in the normal course of business--
(i) to convert the leased marketing premises to a use other
than the sale or distribution of motor fuel,
(ii) to materially alter, add to, or replace such premises,
(iii) to sell such premises,
(iv) to withdraw from the marketing of motor fuel through
retail outlets in the relevant geographic market area in which
the marketing premises are located, or
(v) that renewal of the franchise relationship is likely to
be uneconomical to the franchisor despite any reasonable changes
or reasonable additions to the provisions of the franchise which
may be acceptable to the franchisee; and
(B) the requirements of section 2804 of this title have been
complied with.
(2) The provisions of paragraph (1) shall not affect any right of
any franchisee to recover actual damages and reasonable attorney and
expert witness fees under subsection (d) of this section if such
nonrenewal is prohibited by section 2802 of this title.
(f) Release or waiver of rights
(1) No franchisor shall require, as a condition of entering into or
renewing the franchise relationship, a franchisee to release or waive--
(A) any right that the franchisee has under this subchapter or
other Federal law; or
(B) any right that the franchisee may have under any valid and
applicable State law.
(2) No provision of any franchise shall be valid or enforceable if
the provision specifies that the interpretation or enforcement of the
franchise shall be governed by the law of any State other than the State
in which the franchisee has the principal place of business of the
franchisee.
(Pub. L. 95-297, title I, Sec. 105, June 19, 1978, 92 Stat. 331; Pub. L.
103-371, Sec. 4, Oct. 19, 1994, 108 Stat. 3485.)
References in Text
The Federal Rules of Civil Procedure, referred to in subsec. (d)(1),
are set out in the Appendix to Title 28, Judiciary and Judicial
Procedure.
Amendments
1994--Subsec. (f). Pub. L. 103-371 added subsec. (f).
