N.J. court rules in favor of Allstate in franchise dispute

PRNewswire

NORTHBROOK — Allstate Corp. said the Superior Court of New Jersey has dismissed all claims filed against its New Jersey subsidiary by three of its franchisees.

The three exclusive agents filed lawsuits in 2011 seeking to prevent the termination of their agency agreements for failing to meet certain business objectives. They alleged they had franchise relationships with Allstate New Jersey and were protected under the New Jersey Franchise Practices Act.

The plaintiffs’ application to stop their termination was denied.

The court determined that the agents were not franchisees and have no protections under the New Jersey Franchise Practices Act, the company said in a release. The court noted in its decision that the “insurance industry has never been found by any court in New Jersey, or elsewhere, to be home to an insurance company franchiser, or agent franchisee.”

Allstate has maintained that exclusive agents are independent contractor agents and not franchisees. The court decision affirms the company’s position.