Philip F Zeidman is a senior partner in the Washington, DC office of DLA Piper. He devotes his practice to domestic franchising law and the rapidly growing field of international distribution, licensing and franchising law. WWL named Philip “Global Franchise Lawyer of the Year” at the WWL Awards for nine consecutive years, reporting that when it tallied the votes, Philip “received more votes from clients and peers in the course of the research than any other individual worldwide”. In May 2017, at a ceremony in London, it named him the recipient of its Lifetime Achievement Award.
What was the most important moment of your early legal career and why?
When I was 30 years old I was named general counsel of the Small Business Administration with responsibility for 210 lawyers, almost all of them older than I was. My previous work had been both varied and interesting, including other positions in that agency, a trial lawyer for the Federal Trade Commission and a legal officer in the Air Force. But those positions had typically entailed individual assignments, working largely alone. The new role was daunting (I was the youngest chief legal officer of any department or agency of the US government), and for the first time, I was responsible for the work of a large number of others, widely spread geographically. It gave me a new skillset; and, because of the political importance of our constituency (millions of small businesspeople), it gave me essentially carte blanche to poke my nose into almost every activity of the federal government. Both new perspectives served me well for the next half-century – in law, politics and the dynamics of a wide range of institutions and organisations.
How has the franchise field evolved since you began your career?
My first clients were, almost without exception, the organisations that individual entrepreneurs had created, and in which they were still the dominant figure. This was, after all, at the infancy of franchising: Ray Kroc and McDonald’s, Colonel Sanders and KFC, Kemmons Wilson and Holiday Inn, Henry Bloch and H&R Block, etc. The challenges of franchising on a large scale are so much more complex today that the client is likely to be a large, multi-layered and frequently multinational corporation. (Frankly, it was more fun before.)
How is the franchise market in the US performing at the moment?
The largest contributing factor to the well-performing franchising market is, of course, the American economy itself, which has now pretty clearly emerged from the after-effects of the recession triggered by the Wall Street crisis of a decade ago. But franchising is performing at levels above the general economy. It did so in 2017, and is predicted to do so again throughout 2018. The number of franchise establishments increased 1.6 per cent in 2017, with another 1.95 per cent forecast for 2018. Franchise employment is forecast to grow almost 4 per cent.
What are the greatest opportunities and challenges currently facing franchisors seeking to expand in the US market?
Unquestionably, competition and cost. Despite the emergence of non-US franchisors, 81 of the top 100 franchisors in the world remain US-based, and they are obviously strongest in their home market. If an incoming franchisor wants to be able to compete across the entire country, distances are great, as are regional differences. But the opportunities remain, because both technology and social media have narrowed that gap. And some of the oft-cited barriers to entry (litigation; government regulation; cost of property) are either somewhat overblown or do not differ all that much from conditions in their own home markets.
How are franchisors using technology to stay ahead of the curve and gain an advantage over their competitors?
With all the talk about the unique characteristics of franchising, the fact remains that you cannot insulate franchising from the economic, political and social conditions in the country at large. A franchisee may be able to control the costs at the unit more readily (for example, deploying resources such as one’s teenage children), but ultimately the same forces are operative. And many non-franchise-specific legal developments can nonetheless have a direct impact on franchising; consider, for example, the “joint employer” issue.
How have attitudes toward franchising changed?
In its early days, the notion of franchising was met by a mixture of hostility and ignorance by government. That attitude was fuelled by a few well-publicised instances of uncharacteristic but attention-getting greed and sharp practices. Patient education, led by the International Franchise Association, began to turn those attitudes around; and, as the evidence of the wealth-building capability of franchising began to mount a distinctly more favourable approach began to manifest itself. But today we are seeing that that mindset cannot be taken for granted; eternal vigilance is indeed the price which franchising must be prepared to pay.
What makes for a successful relationship between in-house lawyers and external franchise lawyers?
An in-house lawyer must be persuaded, and regularly have reason to be reminded, that the external lawyer is a partner, helping the in-house counsel and the company itself achieve their objectives. If the relationship is simply one of vendor and purchaser it will always be vulnerable.
How do you expect franchise law and practice to develop over the next five years?
Technology will affect every facet of franchising. Franchise lawyers, both inside and outside counsel, will need to be as knowledgeable and as au courant as their clients. They fail to do so at their peril.
Philip Zeidman ranks as a Global Elite Thought Leader for his outstanding work in franchise and is praised by peers for his “excellent reputation in the international field”.
Philip F Zeidman is a senior partner in the Washington, DC office of DLA Piper. He devotes his practice to domestic franchising law and the rapidly growing field of international distribution, licensing and franchising law. Who's Who Legal named Philip the Global Franchise Lawyer of the Year at the Who's Who Legal Awards for nine consecutive years, reporting that when it tallied the votes, Philip "received more votes from clients and peers in the course of the research than any other individual worldwide". In May 2017, at a ceremony in London it named him the recipient of its Lifetime Achievement Award.
Mr Zeidman has served as general counsel to the International Franchise Association for virtually his entire career; he received its Free Enterprise Award in 2016. He has also served as special counsel for the Japanese Franchise Association and counsel to a number of US and foreign companies and trade associations. He served as the first chairman of the American Bar Association's antitrust law section's distribution and franchising committee, and as chairman of the franchising law committee of the American Intellectual Property Law Association.
He has been elected honorary life member of the International Bar Association and has served as chairman of the Association's international franchising committee, vice chairman of its Asia Pacific forum, liaison to its Latin American/Caribbean steering group and representative on its general professional programme committee. He served as president of the International Bar Association Foundation. He has been elected a trustee of EyeWitness to Atrocities, a Londonbased trust created by the association to harness technology to bring perpetrators of war crimes and crimes against humanity to justice.
Mr Zeidman has written extensively on the subject of international franchising, distribution and licensing, including regular columns in Franchise Times. He has also written for Franchising World and Global Competition Review. He is the author of Aspects of the Market Economy: Franchising, which has been translated into Russian and also serves as a textbook for courses on entrepreneurism in eastern Europe. Mr Zeidman also served as the general editor of the American Bar Association's Survey of Laws and Regulations Affecting International Franchising; associate editor of the International Journal of Franchising and Distribution Law; and consulting editor of CCH's Global Franchising Alert and Getting the Deal Through: Franchise. Mr Zeidman is the editor of Legal Aspects of Selling and Buying (Thomson/Reuters) and Franchising: Regulation of Buying and Selling a Franchise (Bureau of National Affairs). He has written for publications including The Asian Wall Street Journal and Worldlink, and has been interviewed on such television programmes as The Today Show, The McNeil/Lehrer Report, WorldNet, CNN Asian Business Report and the CNN financial network, CNNfn. He served as a contributing editor for antitrust and trade regulation of The Legal Times and as a member of the advisory board of the Bureau of National Affairs' antitrust and trade regulation report. For 21 years Mr Zeidman chaired both the annual New York Law Journal distribution seminar and the annual bi-coastal franchising symposium, which then became the franchising segment of the annual Practicing Law Institute advanced antitrust seminars.
Mr Zeidman has spoken at the World Economic Forum in Davos, Switzerland. He presented "With the Best of Intentions: Observations on the International Regulation of Franchising" at Stanford Law School, published in Stanford Journal of Law, Business & Finance, for which he was the recipient of the Burton Award for Excellence in Legal Writing, presented at the Library of Congress.
Mr Zeidman has engaged in a transactional practice, testified on franchising before governmental bodies, participated in judicial and administrative proceedings, taught at universities and appeared before business and professional groups in 35 countries around the world and before the Commission of the European Union, as well as before numerous US congressional committees. He has advised a number of government bodies on franchising as a technique for international development and the privatisation of state-owned enterprises: these include the Organisation for Economic Cooperation and Development (Paris), on work in central and eastern Europe; the World Intellectual Property Organization (Geneva), assisting in the development of its franchising guide for developing countries; the International Centre for Public Enterprises (Ljubljana), helping to create an international franchising databank for use in transitional economies; the International Executive Service Corps, introducing franchising into Morocco; Unidroit, a UN-affiliated agency (Rome), advising on the regulation of international franchising; the US Agency for International Development, working with the Indian government to assist black entrepreneurs in post-apartheid South Africa and assisting the privatisation agencies of the former Soviet Union; the Middle East Investment Initiative, to introduce franchising into Tunisia; and the World Bank, on franchising as a non-equity mode of investment in developing countries. He served on the International Chamber of Commerce's working group on franchising (Paris).
Prior to entering private practice, Mr Zeidman served in several positions with the United States government, including trial lawyer, Federal Trade Commission, general counsel, small business administration; and special assistant to the vice president of the United States.
Mr Zeidman has been admitted to practise before the US Supreme Court and in the District of Columbia, New York, Florida and Alabama. He graduated with honours from Yale College, where he was named Scholar of the First Rank. He was elected chairman of his class council at Yale, received its first Distinguished Service Award and was named its representative to the association of Yale alumni. He received his law degree from Harvard University and also studied at the Harvard Graduate School of Business Administration. Mr Zeidman has served as a member of the advisory board of the Yale School of Management; a trustee of the Yale-China Association; and a member of the advisory board of the DeWitt Wallace Center for Communications and Journalism of the Terry Sanford Institute for Public Policy of Duke University. He is a founding member of the Appleseed Foundation and has served as its general counsel. Mr Zeidman has been named a member of the Advisory Board to New Perimeter, the DLA Piper nonprofit subsidiary, which conducts a wide ranging cross border pro bono practice.