Bundy Law FirmDavid KaufmannFRANCHISE BULLYINGFranchise Disclosure Documents (FDD)FRANCHISE LEGISLATIONGlenn DuncanJim LagerMichael JobloveNASAA Proposed SOPPeter LagariasPIRTEK USASPOTLIGHT 1

Franchise Discussion, Documents, Links: NASAA Proposed S.O.P.

Happy New Year!  Unhappy Franchisee is hosting good old fashioned Franchising Town Hall Meeting, pig roast & idea exchange!

Share this link on social media & invite all to join in:  UnhappyFranchisee.Com/NASAA-Townhall

2022 is the Year of Franchise Truth… so share a comment, opinion and/or rant… the industry, state & federal regulators are listening!

North American Securities Administrators Association, Inc. (NASAA) Invites Public Comments on Proposed S.O.P.


NASAA web page: 

NASAA Seeks Public Comment on Proposed Statement of Policy Regarding the Use of Franchise Questionnaires and Acknowledgments

Sample Franchisee Questionnaires (aka Franchisee Disclosure Acknowledgement Statement)

Franchisee Questionnaire. Burgerim 2017

Franchisee Questionnaire.Dental Fix RX FDD 2019 WI

Franchisee Questionnaire. You Move Me CA FDD 2021

 Public Comments & Articles

Attorney Peter Lagarias:  Let’s Revoke Franchising’s Newest “Get Out of Jail Free” Card

Former FTC prosecutor Peter Lagarias provides a concise overview of the NASAA SOP issue & why it should be adopted.

Howard E. Bundy: NASAA Proposed Statement of Policy Changes No Laws

“The result of signing seemingly innocuous statements is that franchisees routinely give up all of their legal rights—forever.”  – Howard Bundy

Sean Kelly:  The “Trojan Earnings Claim” Deceives Franchisees & Courts

Sean Kelly shows how many prospective franchisees have received illegal earnings claims… but don’t know they came from the franchisor.

Kim Perrotta: Questionnaires Further Empower Ethically Absent Franchisors

“Potential Franchisees are fed a seemingly endless stream of ‘positive press’ that often flies in the face of information provided in the Franchise Disclosure Document.”

Joel Libava: Franchise King Supports NASAA Proposed S.O.P.

“In today’s digital world, it’s way too easy for would-be franchisees to get “earnings” information from sources that aren’t vetted, or in some cases, from disinformation campaigns…”

Franchisee Brandon Moore: NASAA S.O.P. Allows Franchise Accountability to be a 2-Way Street

“Questionnaire and Acknowledgement[s]… are nothing more than Legal SealClubs used to keep the Franchisees at bay.”

Franchisor Attorney David Kaufmann Controversy

Franchisor Attorney & NASAA Advisor David Kaufman Issued a Restraining Order to Prevent Franchisee’s Letter to NASAA

Is it proper – and legal –  for franchisor attorney, mediator & NASAA advisor David Kaufmann to issue a restraining order to keep franchisee Jim Lager from sharing his opinions with NASAA?  And previously preventing him from participating in the FTC’s review of The Franchise Rule?

Are tactics like this why so few franchisee voices  respond to government invitations to comment?

This is the letter former franchisee Jim Lager was ordered not to submit to NASAA despite its not naming the franchisor.

Franchisee Jim Lager’s Letter to NASAA 122121

Lager decided to defy Kaufmann & submit it anyway.  He notified NASAA about Kaufmann prohibiting his participation:

Franchisee Jim Lager’s  Letter to NASAA 122821

He decided to also share this year-old letter he was told he could not submit to the FTC December, 2020:

Franchisee Jim Lager’s Letter to the FTC re: The Franchise Rule 

David Kaufmann’s Restraining Order RE: NASAA Comments

Discussion posts:

NASAA Advisor Allegedly Forbids Franchisee Participation in NASAA Public Comments

Franchise Attorney, Mediator David Kaufmann Ethics Accusations

Jim Lager sent a letter to NASAA asking if he can be excluded from discussion:

Jim Lager Letter to NASAA 12/28/21 re: Kaufmann’s order not to submit

In 2020, A Franchisee Was Ordered Not to Submit Comments to Federal Trade Commission (FTC)

Here’s Lager’s letter to the FTC regarding Kaufmann’s order:

Lager Letter to FTC 122821


Documents and related letters have been released exclusively through UnhappyFranchisee.Com.

Media credits should include UnhappyFranchisee.Com & link. 

For more information or interview requests, contact Sean Kelly at UnhappyFranchisee [at] Gmail [dot] Com.

We welcome comments and clarification from David Kaufmann, Michael Joblove, PIRTEK USA as well as the franchise regulators of NASAA and the FTC.

NOTE:  Unhappy Franchisee provides an open invitation to all individuals and companies discussed, mentioned or involved with our posts.  We invite you to provide corrections, clarifications, rebuttals or alternative points-of-view in the comments and/or by emailing us at UnhappyFranchisee [at] Gmail [dot] Com.  We welcome all respectful opinions and value open, productive discussion.  We also respect the protected right of anonymous speech and assure the confidentiality of our sources and those who wish to contribute anonymously.  Threats and bullying will not be tolerated (especially when directed at us).

The opinions expressed are those of the author or of those he has quoted.  Statements of fact are true to the best of our knowledge;  always do your own research and come to your own conclusions.


TAGS: NASAA, North American Securities Administrators Association, franchise legislation, David Kaufmann, Franchise attorney David Kaufmann, mediator David Kaufmann, attorney Michael Joblove, PIRTEK, PIRTEK USA, Glenn Duncan, Jim Lager, franchisee Jim Lager, Franchise NDAs, Federal Trade Commission, FTC, the Franchise Rule, NASAA, Franchise Legislation, AAA, American Arbitration Association

5 thoughts on “Franchise Discussion, Documents, Links: NASAA Proposed S.O.P.

  • From: Jeffrey Johnson
    Sent: Wednesday, January 5, 2022 2:01 PM
    To: NASAAComments@nasaa.org
    Cc: Andrea.Seidt@com.state.oh.us; dcantone@oag.state.md.us

    High-quality franchise organizations do not need any “sleight of hand” to have others say things that they cannot/will not state publicly themselves. This leaves franchise companies, that are not top-tier, to feel like they must use franchisee survey results and clever PR campaigns masquerading as news stories to make claims that the franchisors themselves are not legally or willing to say (such as a financial performance representation).

    All this, in order to sell more and more franchises to unsuspecting franchisee candidates. If certain activities are prohibited for franchisors to do/say themselves (not included in the FDD), why should it be acceptable for them to hire others to do/say the same?

    Furthermore, the franchise community should not give a pass that allows franchise companies to use advance Questionnaires and Acknowledgments to skirt the rules!


    Jeff Johnson
    Founder & CEO
    Franchise Research Institute

  • Jeff I am sure that unscrupulous franchise systems exist although we attempt to never work with them and help create them in the first place, whenever possible.

    However, doing away with the questionnaires and acknowledgements in a format that is customary, seems like throwing out the baby with the bath water!

    As an attorney that also often speaks to franchisee prospects and assists them in reviewing FDD’s, I can tell you that we still see a very large portion that admit to not reading the Franchise Agreement or even attempt to understand it until we force them to review it with us, and ask questions. Sad but true.

    I am in favor or keeping them for the protection of the franchisor, even if it only had 3 questions,
    1) What was the date you received the FDD that contained a Franchise Agreement exactly like the one you are being requested to sign, except for your personal, filled in information?
    2) I have read or had full opportunity to read and have other advisors read the Franchise Agreement before I signed it, and
    3) I am not relying on any information provided by the Franchisor or its salesperson that is not contained in the FDD.

    With a follow-up subquestion, if they can not answer true to question 3, they should be required to list what information they are relying on, so that if it is misinformation, the franchisor has the opportunity to not countersign the Agreement until the misinformation is cured. This would keep both parties in the best light.

    I also think however that if it is a 3rd party sales team that has provided the misinformation, that all penalties and costs should be placed firmly on those individuals and companies, not the franchisors. We do have a lot of sharks in this industry that are not on a franchisor’s W-2 payroll, and if they were held accountable, maybe we would get rid of them.

  • Lynne:

    Thank you very much for sharing your views.

    Perhaps those questionnaires could be used for the reasons stated, but not as part of the legal agreement or as a disclaimer.

    Franchisees, at the moment of signing, do not have the information or experience to know if they have been provided with earnings claims since those who make their living selling false credibility to the undeserving are very good at what they do. As a recovering franchise marketer, I share the secrets of Trojan Earnings claims here: https://www.unhappyfranchisee.com/trojan-earnings-claim/

    While I don’t agree with keeping questionnaires and acknowledgements as part of the FDD, I think you raise a good point here:

    “I also think however that if it is a 3rd party sales team that has provided the misinformation, that all penalties and costs should be placed firmly on those individuals and companies, not the franchisors. We do have a lot of sharks in this industry that are not on a franchisor’s W-2 payroll, and if they were held accountable, maybe we would get rid of them.”

    I don’t believe most franchisors want to deal with the headaches brought by franchisees with the wrong expectations. Perhaps it would be more appropriate to have the salespeople, brokers and anyone commissionable on the sale fill out such a questionnaire (preferably under a bright light).

    Personally, I would like to see franchisors fill out a questionnaire about the authenticity and honesty of their lead generation, PR, and marketing claims. Did they publish earnings claims through Franchise Business Review (FBR), 1851 Magazine, BizCom publications, John Haye’s books or other pay-for-praise publications? What awards, rankings and endorsements did they publicize, such as VetFran, FBR, and all the Top This and Best That rankings, without disclosing that they were paid announcements?

    Honest & legit franchisors should realize they are losing valuable franchise prospects to those who do not let such things get in the way of a quick commission.

    Thanks again for your comment!


  • Kim Perrotta

    Undoubtedly, as with any law firm that primarily represents franchisors, you’ll get the opinion as indicated by Lynn Shelton. In order to protect the perspective of a firm that works on behalf of franchisors, they couldn’t possibly do the right thing that might actually be in favor of a prospective Franchisee. Of course, I can appreciate a diverse and different opinion but my expectations for those coming from franchisor allied firms will almost always fall into the same category…one that is anti-Franchisee. None the less it’s good to see them post.

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