Francorp Attorneys Walk Out over Illegal Practice of Law
The resignations come on the heels of reports on Blue MauMau and Franchise Times magazine, stating that Donald Boroian's Francorp had been sued by a client's franchisees when it crossed the boundaries of being a "consulting firm" by stepping into the arena of "practicing law." The lawsuit, scheduled for trial in October, was filed against South Beach Franchising, Boroian and Francorp, alleging that they not only made misrepresentations when selling franchises to prospects, but also that Francorp participated in the unauthorized practice of law in providing legal advice to his client, when neither Boroian nor Francorp was admitted to practice law in any jurisdiction.
Letters Point to Francorp's Disrespect for Attorneys and Law
One letter states, "At Francorp, I have been placed and continue to be placed in positions that question the oath I have pledged as an attorney to uphold. I am concerned that attorneys and Compliance Administrators are asked on a daily basis to engage in what could be interpreted as the unauthorized practice of law." It further proclaims, "Due to the company's blatant disrespect for the Law, the attorneys at Francorp and for the hard earned law licenses of its attorneys, I have been left with no recourse but to submit my resignation."
The other letter expresses basically the same apprehensions. "I am concerned that the Management asks its attorneys to work on project that no corporate legal department is legally allowed to do, and which only a law firm can provide." It gives as an example that attorneys are asked to draft various legal contracts for clients.
Both letters convey further concerns with non-attorneys managing the attorneys or directing their caseload. One states, "I have witnessed and have expressed concerns that the attorneys in the Legal Department are exposed because they must rely on the work of others inside Francorp that are frequently inaccurate."
But it exposes other problems saying that Francorp seeks the advice of its attorneys only for inconsequential matters, such as handling traffic tickets for the president, handling the personal affairs of management, or assisting in establishing private charitable foundations for CEO Donald Boroian.
In the letter, one attorney expressed concern that the job at Francorp required the attorney to perform functions the attorney feared might involve breaking Illinois laws and the laws of different states, or contravening the ethical oath the attorney had pledged to uphold.
In both letters the attorneys claimed they related their concerns to Francorp management with no results. As a final example, one attorney wrote that a vice president had created the Francorp 1 blog and to give it more credibility he copied material from the International Franchise Association website concerning their attorneys and the development of the new franchise disclosure regulations. In the letter, the attorney rebuked the vice president's changing of "IFA Attorneys" to "Francorp Attorneys," by stating, "Such utter disrespect and ignorance affects all of the attorneys as well as Francorp. As an attorney I am not respected and what is even more pathetic is that as an employee I am not respected."
Johns and Marino have declined to make comment for this article.
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Related reading:
- Practicing law alleged (Franchise Times Magazine- September, 2008)
- Franchisees Accuse Francorp of Unauthorized Practice of Law in Partnering with Client
- Francorp's One-Stop-Shop Program Scrutinized at ABA Forum\
- Can Franchise Consultants Practice Law?
- Franchise topic:
- Enter Your Own Tag:
No one can dispute Francorp's recent client success rate. Company's like Monster Mini Golf, Advanced Maintenance, Beadniks, European Wax Centers are all selling franchises and going off of the customized program that Francorp created for them.
But you did manage to point out that FranCrap is putting out FranWhack after FranWhack, that will sell idiot franchise "concepts" to the ignorant.
Although you certainly did not intend to help the detractors of FranCrap make our points, we owe you thanks for identifying the crap list of this week.
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Richard, you wouldn't even be able to afford any of the afore mentioned franchises that you bashed and you wouldn't be able to operate them because it takes physical activity to do so. Its obvious that poor nutrition and excessive amounts of inactivity (blogging) was the result of the flab of neck fat you so prominently display in your photo. My recommendations: 1. Redo Your Terrible Website. 2. Next time you feel the need to bash a legitmate franchised business, reach for a carrot instead. It will be your first step to being physically able to take steps.
Alright, you recommend the following franchise systems: Monster Mini Golf, Advanced Maintenance, Beadniks, European Wax Centers because they are following the Francorp plan.
You suggest that Richard is wrong to designate these as Franwhacks, merely because they are Francorp projects.
Well, lets take a look at Monster Mini Golf.
1. 9 Franchisees at the end of 2007,
2. 8% royalty from these 9 brought in about $225k.
Geez, looks like good grounds for Franwhacking to me.
But perhaps our k clown has a different theory.
Michael Webster, a franchisee attorney in Toronto, Ontario, publishes a website on business opportunities and franchises called "The BizOp News"
Please do not use Francorp to design your Disclosure Documet. They are NOT a licensed attorney and can draft only a generic copy of this document. The amount of money you dish out to these scam artists you could have used to have a LICENSED attorney draw up a document to suit your concept. If you do not mind always hearing "CONSULT YOUR ATTORNEY" and then paying them to correct Francorp's document go ahead and waste your money.
Franchisors should only rely on franchising experts. We currently have a franchisor in deep poo because his local lawyer set him up with documentation that was portrayed to him as representing his business contracts as licence agreements. Even the regulator 'noticed' it was a franchise. Proper documentation for a franchise protects the franchisor and in a perfect world that documentation protects the investments of all parties.
A specialist lawyer will not only look at legal obligations but the needs of the specific franchise and in the States and I imagine in other countries any other relevant state requirements relating to a number of other legal obligations that would otherwise leave the franchisor [and therefore the 'brand'] vulnerable should they be neglected.
Or they can go online and buy the lot for $100 and we can read about them at BMM when it turns to poo.
FranCrap. They are FranWhacks on their own merits.
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Bobby Hull. Stan Mikita. Phil Esposito. Don Boroian. Bobby Orr.
Great men who gave freely of themselves to entertain, inspire and enrich the lives of others. Some gave of themselves in the form of teeth and use of proper grammar, while others, such as Don, gave financially and spiritually. And, like all great men, they had to endure the criticism of lesser people who insist on twisting everything good into something evil.
These are the people who maliciously call benefits such as Francorp's "Deferred Compensation Plans" and "Christmas Club" savings plans "missed paychecks."
These are the people who max out their own credit cards at Sam's Club, then criticize Don for responsibly maintaining a healthy balance on his own.
These same people will never acknowledge nor thank their employer for such perks as free parking, unlimited coffee and stirrers, and use of heat, air conditioning and electricity even on weekends.
Does it ever occur to them that maitre d's have families to support too? That caddies have bills to pay, as do doormen, hostesses, hockey skate sharpeners, and Mercedes salesmen?
Everyone loves to pay lip service to stimulating the economy, but when someone takes bold action he gets criticized for it. And sometimes jailed.
And perhaps no one has done more for the wayward and overlooked franchisor than the company that franchised McDonald's. When others laughed at such concepts as Pancakes A'Plenty, Squid-On-A-Stik and Mr. Colon, the big Mexican door at FCI was always open. Now that they've all won AAFD awards, no one's laughing anymore.
Millionaire Richard Quick, Esq.
Website: FranWorst.comBororian has a very high profile in franchising, and as Nick Bibby points out , Bororian is one of the industry's colorful figures. Like the Weeble of old , Bororian may wobble but he bounces right back.
I don't see this as the reporter out to "highlight" and make moral judgments; rather it is a valid news story discussing someone of interest to the target demographic of the media outlet. There is a vast gulf between the two.
Paul Steinberg
Franchisee Attorney, New York City, Ph: 212-529-5400
Paul Steinberg, Franchisee Attorney, New York City, Ph: 212-529-5400
"I think my favorite part of the report is the fact that Francorp management used the in house counsel for personal matters such as traffic tickets and setting up personal foundations." - Guest
I suspect in-house counsel are not infrequently used to resolve personal legal matters of the CEO and founder, especially if they are an ex-con with a lot of personal matters to resolve.
It may be humiliating for a lawyer who dreams of more, but such mundane filial work is part of the experience of a small company and part of the perks of being the founder of a company who pays the check.
Think of it as building character.
I was actually addressing the issue of Sparks' motivation in writing the piece.
As to "unauthorized practice of law" there is a huge self-interest issue on the part of bar associations and a fair amount of illogic in UPL regulations.
My beef with Boroian (and other alleged UPL violators) is not the drafting of documents but the incompetent drafting of documents.
As Richard Solomon pointed out, if Joe Attorney prepares a legal document, he is violating the UPL statutes if he prepares it as an employee of "FranchiseConsult Corp." Yet if he moves into a broom closet down the hall and puts up a velcro sign "Joe Attorney P.C." all of a sudden that same legal document is kosher.
As to the Francorp decision , the flaw in the court's reasoning is the premise that the mere posession of a parchment written in Latin ipso facto qualifies one to draft specialized contracts. So someone like Nick Bibby or Michael Seid could not draft such documents because they lack "specialized training" but a 23 year-old graduate from the bottom of the class at the worst law school in the country is deemed --as a matter of law-- to have such "specialized training."
Indeed one of the problems with Boroian seems to be his unwillingness to hire qualified people. But let us be clear here: if his in-house attorney had moved down the hallway and become a solo, there would be no UPL violation.
Paul Steinberg
Franchisee Attorney, New York City, Ph: 212-529-5400
Paul Steinberg, Franchisee Attorney, New York City, Ph: 212-529-5400
Guest writes: "I think you overstate the bar associations' position on what a licensed attorney is qualified to do.
I think most bar associations would agree that it is one thing for a person to qualify into a profession, but quite another to say that that qualification alone gives the person "specialized" knowledge."
Guest is right here, Paul.
The license is a necessary, but not sufficient condition.
Michael Webster PhD LLB
Franchise News
Michael Webster, a franchisee attorney in Toronto, Ontario, publishes a website on business opportunities and franchises called "The BizOp News"
I should point out that when we speak of "bar associations" we may be speaking of mandatory groups which may regulate professional conduct or voluntary groups (as in my state) which do not regulate behavior by means of state-backed discipline. Many attorneys question the need for a mandatory bar , but that is a topic in itself. (It is, however, linked with the issue of access to legal assistance--i.e., affordability)
The issue with unauthorized practice of law ("UPL") is not whether someone is qualified to do a particular task, it is whether they are lawfully permitted to do so.
In Francorp decision, the court was referring to the "lawfully permitted" aspect, and the court did not distinguish between competence among attorneys, it distinguished between attorneys and laypeople as classes.
I have seen people at the top of their classes at low-ranked law schools who are very very good. But I specifically noted someone at the bottom of their class, and I have yet to see someone at the bottom of a class who was decent.
From the tenor of some of the remarks, people not familiar with the profession might be under the impression that lawyers are somehow statutorily governed (UPL is statutory) with respect to what cases they are qualified to handle. At least in my state, this is simply not true. As Richard Solomon notes, the chances of holding a minimally-qualified counsel to account for venturing in over his head is rather slim (there are some valid reasons why this is so, but that's beyond our BMM scope).
As to the statement that: "You may have have a quarrel with the rules of the legal profession, but, on net, they have served the profession well" I entirely agree. The rules have served the profession quite well. That was also a point raised by Mr. Solomon in his comparison to a labor union or guild.
Whether the public has been well-served is another matter. Up till a few decades ago, lawyers got together and set minimum fees and actively fought against anything that would take away business--even suing book publishers such as Nolo Press. Even today, the ABA's accreditation process is widely faulted for raising barriers to entry into the legal profession. In some states you must use an attorney to sell a house, in other states the real estate broker does much of the work an attorney would otherwise do.
Whether someone should use an attorney when engaging in a particular transaction is a different matter; with UPL we are speaking of whether someone must use an attorney.
In the old days, you used to have to hire an attorney to do the type of work title companies do nowadays. In some states, lawyers have sued Notaries Public for UPL when a homeowner refinances their mortgage and needs to have the loan docs notarized! (Needless to say, the National Notary Assn disagrees with the lawyers)
Bottom line here is that those who get into UPL arcana are not addressing the real issue which is the quality of the work performed. As a pragmatic aside, I would note that defending the monopoly of the legal profession is not likely to gain much sympathy but focusing on incompetent work is something anyone can see needs rectification.
Paul Steinberg
Franchisee Attorney, New York City, Ph: 212-529-5400
Paul Steinberg, Franchisee Attorney, New York City, Ph: 212-529-5400
Bar Assn. It was accused by the Justice Dept of attempting to monopolize the business of certifying the quality of titles to real property, in violation of the Sherman Antitrust Act.
The Bar Assn had gone after Chicago Title Company for issuing title policies that were not based upon the title opinions of a licensed attorneys. Chicago Title had decided that actuarially a certain percentage of land titles are defective, and that the cost of remediation of titles was calculable. This enabled an insurance underwriter to calculate a title policy premium on the basis of that actuarial data, eliminating the need for any underlying lawyer's title opinion.
The Sullivan County Bar Assn went to the Indiana Bar Assn with a UPL complaint, and the Indiana Attorney General opened a file on the title company for unauthorized practice of law. The title company had more money than the couty bar assn, and got the justice department to go after the bar assn under the Sherman Act. The bar assn hired me.
There have been a number of such disputes. This shows the territoriality of the bar associations regarding perceived poaching on their turf. The definition of poaching is that it is unlawful for a non lawyer to do things that are traditionally the business of licensed attorneys. That is a doctrinal definition that arose in early Massachusetts cases and that has been generally adopted as the test of UPL.
The case was "amicably" resolved (consent order). How that came to be is a very funny story that I wish I could tell. --
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Have you even heard of such an attempt? For a host of reasons, this is less likely than Webster spelling "behavior" correctly. As someone pointed out earlier, many things may give rise to a malpractice claim but that does not mean such claims (even if accurate) would result in disbarrment.
Paul Steinberg
Franchisee Attorney, New York City, Ph: 212-529-5400
Paul Steinberg, Franchisee Attorney, New York City, Ph: 212-529-5400
Bar Association ethics and disciplinary rules are, in sound, quite high minded. They are also guild like in that they purport to fence off areas of activities for the use and benefit of those certified by the bar associations to be authorized to exploit the field.
In that respect, it is not unlike any guild or labor union.
The rules run the gamut from fiduciary duty to competence/experience.The discipline protocols vary all over the place, and - like any adjudicatory system - depend also upon who is prosecuted and who is complaining and who represents the accused. The high and mighty commit with seeming impugnity many offenses for which the low and dusty are censured. You may lose your license for showering accident scenes with your business cards/paying police and cab drivers to direct the injured to your office. On the other hand, it is perfectly OK for the high and mighty to do the same thing with respect to large corporate clients, though the style is different. Country clubs, board memberships and various other collaborative mechanisms exonerate the shenannigans of the large prestigeous law firms that are doing similar things to the personal injury scenario just described.
When you get to the issue of lawyers taking on busness for which they are ill equipped, damn few disciplinary proceedings focus on such practices. Illustratively, that's how, for a few hundred dollars, members of the bar will ill advise franchise invewstors by "reading the contract". So long as the investing public is unaware of the value of "specialized knowledge" in the vettng of franchise investment opportunities, the rules of bar associations will not fill in the void of lack of "insight". As Webster, Steinberg and I have been saying for so long, competent franchise investment due diligence is the cardio pulmonary conditioning that makes open heart surgery less likely.--
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
What is surprising is that Francorp has been down this road before (pdf) in 2002 with competitor Michael Seid and Associates saying that his company was at a competitive disadvantage because he liked obeying the laws, which ban franchisor consultants from providing legal assistance. (BTW, there are some great links at the bottom of Ms. Sparks' news story.)
Having lost before, Francorp should know better. But hey, the unauthorized practice of law (UPL) clause is a dumb law anyhow.
The Illinois state bar association says that the UPL law was established in order "To keep would-be hustlers and scammers from taking advantage of the public..." My question is—How so? Where is the potential for scam in having in-house attorneys prepare legal franchise documents for Francorp clients? Where's the harm?
Are they now Francorp's outside attorneys, doing the same work for roughly the same compensation? Are they in different office address? Until we know the truth of that, these letters could be nothing but window dressing calculated to deal with their complicity in the matter of Francorp's UPL issues. These letters could have been drafted by them or by their own UPL attorney to provide "compliance"/come to Jesus exhibits for the disciplinary committee.--
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
it's just little more than cut and paste, so 120 clients isn't a lot for one person - even if they aint a lawyer.--
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
I-Franchise is the worst of the worst in franchise consulting. How come all of this negative attention towards Francorp has escaped that group at I-Franchise? I can't beleive that Mark Seibert hasn't been sued multiple times for his misleading and fraudulant sales tactics. I franchised my business through them based on all of the negative hear say he gave me about Francorp and got nothing! That guy never even ran a franchise company before and he likes to claim to know all the tricks in the business. Mark Seibert is a complete fraud.
It seems like Mark Seibert and that ifranchise group do have it coming to them, you can't run a business like that forever without having successful clients. People like Seibert wil have a tough time making their sales pitch in 5 years when they still are talking about Auntie Anne's who actually hired a different company that Seibert worked for. I am surprised that it has taken this long for someone to say anything about ifranchise.
On occasion I like to read the information posted on the Francorp blog. Not that the information is terribly interesting but because the site is sooooo PRO Francorp it is almost comical. Every comment is incredibly positive for the firm and me thinks that all are posted by Francorp employees. Recently, there was some serious I-Franchise bashing on the blog. I find it hard to believe that it is a coincidence that there are negative I-Franchise comments on this forum at the same time. Boroian and Francorp, who have lost scores of clients to Mark Siebert and I-Franchise over the years, probably instructed his staff to make the negative posts. This may be Don's only chance to win a client from Mark and his team. Don may be feeling the constant pressure of the IRS breathing down his collar.
In terms of experience, Siebert has been in the industry going on a quarter century. His team may be small but he has numerous staff with 10+ years in their respective roles (compared to comporable Francorp employees who have only a few years experience) and his team of national consultants is top drawer in every respect.
All in all, if I need to hire consultants to put together my franchisor program from scratch, my dough is going to Mark Siebert.
I cannot beleive that this company has been in business even for 8 years. This Seibert is one of the most self-centered people I have ever met. If they truly were good at franchising companies, how come when you go to the tradeshows to talk with franchisors the only ones who have worked with them consist of a tanning company and some other random business. The fact is that none of these consulting firms provide any real value to a new franchise system. Buyer beware, do not spend money on a franchise consultant if they want more than $10k to help you franchise. Mark Seibert/IFranchise and Don Boroian/Francorp will tell you otherwise, but it doesn't work that way. Spend your money on lead generation and marketing your franchise.
Shame on you, Francorp VP Christopher James Conner, for extending your false blog postings -- full of sycophantic Francorp praise and rabid iFranchise bashing -- from your various Francorp blogs to this forum. Don Boroian may be a "snappy dresser," but you don't wear "desperate" very well.
successful franchise people. I have never heard even one negative word about him and his associates, and I hear it when there is word to be heard.
As for Francorp and Boroian... what is there to say that hasn't already been said...I mean, really?
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Let's get serious for a moment, what has Francorp not accomplished in the franchise world? I think it would be a stretch to say that IFranchise has ever come close to matching the success they have had. Over the years it seems that he has upset some people along the way, I don't know of too many successful business people who haven't done that. But that doesn't take away from francorp's client success. It amazes me that this many of Francorp's competitors could possibly act and speak as if they are a credible source of information whether Francorp is good at what they do. Get the facts straight, Francorp has developed more successful franchise companies than every franchise consultant on this board put together.
It doesn't ake a genious to figure out who is posting on this board. Employees from each company are writing about themselves. Neither Mark or Don are very intelligent - trust me, Northern Illinois isn't that difficult Mark, and if you get John Seibert on the phone, prepare to be dumber after your call is finished. Don't work with any of these franchise consulting companies. If the sign says I-Franchise or Francorp, walk the other way.
I too was absolutely amazed by the business tactics that I-Franchise utilizes. I'm not sure which side of the story to beleive here, it really depended on who you listened to as to what actually happened. But I found it extremely questionable that I-Franchise's client list was clients that Francorp had developed. I wont throw stones because I chose not to work with either company but I did not trust Mark Seibert.
I have been in the franchise industry for over 20 years and worked with many different franchise consultants and franchise organizations. I can support the notion of I-Franchise being little more than a mom and pop group of sales people. This is at best a "rag-tag" group of small business consultants. The only person on their staff who brings any real consulting experience is David Hood, outside of that they literally are comprised of administrative assistants and salespeople. My advice, don't work with anyone who can't describe their first hand experience running a franchise organization. This seems like common sense to me, but how could you actually have the experience needed to consult someone else how to franchise? Because Mark Seibert worked with another consulting firm prior to I-Franchise means little to nothing to new franchisors.
While you looked at both firms to launch you as a baby franchisor, what did you make of this statement by Francorp's attorneys in the article above?
"At Francorp, I have been placed and continue to be placed in positions that question the oath I have pledged as an attorney to uphold."
Many in house Francorp attorneys over the years have wrestled with ethical issues regarding their oath while at the firm.
At this point the firm has had one attorney on staff for many, many months. Word is that one attorney is doing more personal legal work for Don than drafting any legal documents for clients. In fact,nearly all of the drafting is being done by the paralegals on staff. Potential Francorp clients, keep that in mind when considering the firm.
Have people forgotten how to make a cogent argument to business people?
I'm assuming the above rant was by Don Boroian or his cohorts to take the discussion off of his outfit. The ranter above doesn't want to keep on target of Francorp's in-house attorneys walking out on him.
Agreed, Darnelle......the ranters must be the same shills and sycophantic Francorp employees who populate their many Francorp blogs (including "Don Boroian, the Snappy Dresser") with over the top praise of their company and felonious founder.
Wow. I especially like this one:
http://donboroianclothes.blogspot.com/2008/10/don-boroians-fur-coat.html
I guess those folks have a lot of time to kill around there.
Interesting reading indeed....there's a high "creepy" factor going on with that "Fur Coat" blog entry.
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