From: Kerry Calderelli Kerry@rpmpizza.com
Date: 4/29/97 6:47pm
** High Priority **
Via Electronic Mail
April 29, 1997
Federal Trade Commission
Re: 16 CFR Part 436
RPM Pizza, Inc. is a 139 store Domino's Pizza Franchisee, I am President and currently a member of American Franchise Association (AFA) and the White House Conference on Small Business (WHCSB). As a member of these 3 groups I would like to see the FTC act on several issues.
Domino's Pizza is a great company to be a franchisee , yet the Federal Trade Commission (FTC) can improve and protect the entire franchise industry. The FTC helps protect first time franchisees but, the franchise industry has grown and matured. The FTC needs to focus on helping protect second generation franchisees or existing franchisees when renewing 10 and 20 year old contracts.
The FTC should act on unfair and deceptive acts or practices perpetrated upon current franchisees. The act should also include removing the contractual barriers that prevent franchisees from exercising their basic legal and constitutional rights. The barriers can be found in nearly every franchise agreement written by the franchisor.
The FTC should prohibit franchisors from requiring prospective and renewing franchisees to resolve all disputes- whether via litigation or arbitration-in the home state of the franchisor.
The FTC should also do away with requiring franchisees to sign post-term covenants not-to-compete which then prevent them from earning a living.
These provisions clearly violate the spirit of federal and state due process constitutional law. Freedom of association is a constitutional right. The FTC should take action against franchisors who intimidate or retaliate against their franchisees, directly or indirectly, for getting together for any legitimate business purpose . The FTC also ought to mandate that franchisors provide a list of all associations within their systems to all potential and existing franchisees.
The FTC needs to begin dealing with issues important to current franchisees. These would include restraining trade by restricting the franchisees' ability to use local suppliers. For example uniforms and food at Domino's Pizza must be purchased from only one supplier Domino's Pizza Incorporated (DPI), our franchisor.
RPM PIZZA, INC.
Glenn A. Mueller
XC: Trent Lott