Protecting Franchisees from Fraud

If you or someone you know purchased a franchise from Simpatico and conducted business under the name Jan-Pro or Stratus Building Solutions or any other janitorial franchise companies and were wronged, call The Mutrux Law Firm and our franchise lawyers today at 314-270-2273.

Owning your own business is part of the American Dream. But companies like Stratus Building Solutions are preying on the hopes and dreams of individuals in St. Louis and across the United States by hocking franchise “opportunities” with “proven methods” to get you to a secure future immediately.

Contact our franchise lawyers at The Mutrux Law Firm at 314-270-2273 if you or someone you know is a victim of fraud, breach of contract, or other unlawful schemes committed by Simpatico, Jan-Pro or Stratus Building Solutions.

  • Were you guaranteed a monthly income you never received?
  • Were your cleaning contracts wrongfully terminated by the franchisor without notice?
  • Were you charged undisclosed fees by the franchisor?

If you answered yes to any of the above questions, fill out the form below to start taking action against the franchisor who wronged you.

We plan to file suit against Stratus Building Solutions in the State of Missouri and are seeking to have the suit certified as a class action.  We are also investigating claims against other janitorial franchise companies.

Contact Our Franchise and Fraud Lawyers Today

Contact our franchise lawyers at The Mutrux Law Firm at 314-270-2273 if you or someone you know is a victim of fraud, breach of contract, or other unlawful schemes committed by Simpatico, Jan-Pro or Stratus Building Solutions.

We are seeking individuals across the United States to represent in a class action against Simpatico, Jan-Pro or Stratus Building Solutions. Call The Mutrux Law Firm at 314-270-2273 today to receive free information about this lawsuit.

Forms of Franchise Fraud

Franchise fraud is a broad term referring generally to fraud related to the sale, operation, or termination of a franchise. Contact our franchise lawyers at The Mutrux Law Firm at 314-270-2273 if you or someone you know is a victim of fraud, breach of contract, or other unlawful schemes committed by Simpatico, Jan-Pro or Stratus Building Solutions.

Common ways franchisors take advantage of franchisees include:


Churning (setting-up to fail) The more times a franchise is sold, the more money the franchisor makes. Franchisors profit from the initial sale and on-going fees and royalties paid by franchisees, so by setting up a business to fail, the franchisor can reclaim the failed franchise and resell it to profit yet again. This practice is known as “churning” and is associated with pyramid schemes.

Misrepresenting profits – Franchisors often promise franchisees huge profits to lure them into purchasing a franchise. But all too frequently these profits never materialize, leaving franchisees to incur major financial losses. Federal law prohibits franchisors from predicting future earnings to perspective or actual franchisees.

Excessive fees & costs – Franchisors often downplay the costs of owning a franchise or royalties that a franchisee is required to pay. In other cases, franchisors force franchisees to purchase specific products from certain vendors at inflated prices or demand that franchisees pay for costly advertising or related expenses.

Breach of contract – A franchise agreement sets out the terms and conditions that will govern the ownership of the franchise and is usually drafted by the franchisor. If a franchisor does not fulfill its duties under the contract or breaches the terms of the agreement, then harmed franchisees may have a legal claim to hold the franchisor responsible.

Terminating a franchise agreement – various states have franchise laws that protect against unfair terminations of franchise relationships by franchisors. Generally a franchisee may not be terminated prior to the termination of the franchise agreement without “good cause” as defined under these franchise laws.

Laws Regulating the U.S. Franchise Industry

In the franchisee-franchisor relationship, the franchisor is typically a major company and often has the upper-hand. Some companies use this to take advantage of investors, misleading investors about profits, fees, and costs, or setting up schemes so that the franchise will fail and the franchisor company can resell the franchise outlet to another unsuspecting investor. Franchise companies that engage in this kind of conduct may be violating franchisees’ contractual rights and breaking franchise laws.

The basic laws and regulations governing the U.S. franchise industry include:

  • The FTC Franchise Rule
  • State franchise disclosure laws
  • State franchise relationship laws

The FTC Franchise Rule

The Federal Trade Commission (FTC) “Franchise Rule” defines practices that are unfair or deceptive in the franchise industry, requiring franchisors to provide potential franchise purchasers “material information” about the franchise, including:

  1. the nature of the franchisor and the franchise company;
  2. the franchisor’s financial viability;
  3. the costs and fees involved in buying and operating a franchise outlet;
  4. the terms and conditions that govern the franchise relationship; and
  5. the names and addresses of current franchisees who can share their experiences within the franchise to be able to independently assess the franchisor’s claims.

State franchise disclosure laws

Fifteen states (California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Oregon, Rhode Island, South Dakota, Virginia, Washington, and Wisconsin) have franchise investment laws that require franchisors to provide pre-sale disclosures, known as “offering circulars,” to potential purchasers. These are legal documents designed to give prospective franchisees all the information relevant to a franchise offering.

State franchise relationship laws

Various states also have franchise relationship laws. Franchise relationship laws deal with the ongoing relationship between a franchisor and franchisees after the parties have signed a franchise agreement.

These laws generally limit the franchisor’s ability to terminate a franchise or to refuse to renew or to permit the transfer of a franchise without “good cause.” Good cause is defined to include any failure of the franchisee to comply with any lawful requirement.

Call Us Today

Contact our franchise lawyers at The Mutrux Law Firm at 314-270-2273 if you or someone you know is a victim of fraud, breach of contract, or other unlawful schemes committed by Simpatico, Jan-Pro or Stratus Building Solutions.