September 30, 2025|Publications
September 30, 2025 | United States District Court for the Northern District of Illinois | Unpublished Opinion
Executive Summary
In an unpublished decision, Judge Franklin U. Valderrama of the Northern District of Illinois dismissed all claims brought by a Florida dealer against Illinois-based MI-BOX Holding Company (“MHC”), enforcing contractual choice-of-law and venue provisions and rejecting attempts to apply Florida’s expansive franchise and business-opportunity statutes to an out-of-state franchisor. The plaintiff, MI-BOX of North Florida, LLC, alleged that MHC and its regional developer, MI-BOX Florida, LLC (“MI-BOX FL”), violated the Florida Franchise Act, the Florida Sale of Business Opportunities Act (“FSBOA”), and the Florida Deceptive and Unfair Trade Practices Act (“FDUTPA”). The court found that the Dealership Agreement’s New Hampshire choice-of-law clause foreclosed Florida law, that MHC was not a party to the contract and owed no duty to provide a Franchise Disclosure Document (“FDD”), and that the FSBOA’s trademark exemption barred recovery. The decision offers franchisors a valuable case study in the use of choice-of-law clauses, corporate separation, and statutory exemptions to avoid multistate liability.
Relevant Background
MI-BOX operates a nationwide system offering mobile storage and moving services built around its patented lift system and the “MI-BOX” trademark. At the top of the structure sits MI-BOX Holding Company, based in Illinois, which owns the brand’s intellectual property and licenses it to regional developers. One such developer, MI-BOX Florida, LLC, organized in New Hampshire, held the rights to market and sell MI-BOX dealerships throughout Florida. In 2021, MI-BOX FL sold a dealership to MI-BOX of North Florida, LLC, a Jacksonville-based company seeking to operate MI-BOX-branded storage services in two Florida counties.
Two contracts defined the parties’ rights. First, MI-BOX FL and North Florida entered into a Dealership Agreement that granted exclusive territorial rights and contained a New Hampshire choice-of-law clause. MHC was not a party to that agreement. Second, MHC and North Florida executed an Equipment Purchase and Trademark License Agreement, under which MHC sold MI-BOX containers and lifts and granted the dealer a limited license to use MI-BOX trademarks. That contract contained its own Illinois forum clause designating Cook County or the Northern District of Illinois as the exclusive venue.
When the dealership struggled financially, North Florida sued both MHC and MI-BOX FL in the Middle District of Florida. The plaintiff claimed that both entities functioned as franchisors and had failed to deliver an FDD, misrepresented the system’s profitability, and violated Florida’s franchise, deceptive-trade, and business-opportunity statutes. The case was bifurcated according to the contracts’ venue provisions: claims against MI-BOX FL were transferred to the District of New Hampshire, and claims against MHC were transferred to Illinois.
The complaint alleged five causes of action: violation of FDUTPA, fraudulent inducement (against MI-BOX FL only), violation of the Florida Franchise Act, rescission, and violation of the FSBOA. North Florida argued that because MHC had licensed the trademark and supplied equipment, it should be treated as a joint franchisor and held jointly liable for MI-BOX FL’s alleged misconduct. MHC moved to dismiss, asserting that it had no disclosure obligations, that Florida statutes could not apply under the contracts’ governing-law clauses, and that any FSBOA claim was barred by the statute’s trademark exemption.
Decision
The court granted MHC’s motion to dismiss in full. As a threshold matter, Judge Valderrama found that MHC had no duty to provide an FDD or to comply with Florida franchise law because it was not a party to the Dealership Agreement. The court explained that while “under Florida law, a franchisor is required to provide a prospective franchisee with an FDD at least fourteen days before the prospective franchisee signs a binding agreement,” MHC “had no duty to provide Plaintiff with an FDD” since “the Dealership Agreement was made solely between Plaintiff and MI-BOX Florida, not MHC.” MI-BOX of N. Fla., LLC v. MI-BOX Holding Co., No. 1:24-cv-07520, 2025 WL 2785430, at *2 (N.D. Ill. Sept. 30, 2025).
The court also held that the Dealership Agreement’s New Hampshire choice-of-law clause foreclosed any claim under the Florida Franchise Act. Citing Cluck-U Chicken, Inc. v. Cluck-U Corp., 358 F. Supp. 3d 1295, 1309–10 (M.D. Fla. 2017), the court reaffirmed that where parties expressly select another state’s law, “claims brought under the statutes of other states are generally inapplicable.” Even if Florida law applied, the complaint contained no specific misrepresentation or omission by MHC sufficient to support liability.
The court then dismissed the FSBOA claim for two independent reasons. First, the dealership transaction did not involve the sale of a “sales program” or “marketing program” as required under the Act. Second, even if it had, the claim would be barred by the statute’s trademark licensing exemption, section 559.801(1)(a)(4), which excludes agreements made “in conjunction with the licensing of a trademark or service mark.” The Equipment Purchase and Trademark License Agreement expressly granted the dealer the right to use MI-BOX trademarks, thereby placing the relationship squarely within the exemption. The court noted that the District of New Hampshire had reached the same conclusion regarding MI-BOX FL, holding that “it is plain that the Equipment Purchase Agreement was made in conjunction with the licensing of a registered trademark or service mark, and as such, the exception precludes the applicability of the FSBOA.” Id. at 3.
Finally, the court emphasized MHC’s separate corporate identity. Although North Florida characterized MHC and MI-BOX FL as an integrated franchisor network, the evidence showed distinct contractual roles: MHC licensed equipment and intellectual property, while MI-BOX FL granted dealership rights. The Equipment Purchase Agreement specifically stated that “no one from [MHC] made any promises or representations that [Plaintiff] will earn or is likely to earn a profit exceeding [Plaintiff’s] initial investment.” That language, coupled with the separate venue provisions, confirmed that MHC could not be held liable for MI-BOX FL’s alleged misrepresentations.
Looking Forward
The MI-BOX of North Florida decision illustrates how choice-of-law discipline, entity separation, and trademark licensing can protect franchisors from the reach of expansive state statutes. The court’s enforcement of both New Hampshire and Illinois venue clauses reaffirms that properly negotiated governing-law provisions remain one of the most effective tools for avoiding forum shopping in franchise and dealership litigation. Sophisticated parties who knowingly agree to such clauses can expect them to be upheld, even when the chosen law differs from the franchisee’s home state.
The ruling also demonstrates the practical benefits of maintaining clear boundaries between a franchisor, its area developers, and its dealers. MHC’s limited contractual role insulated it from liability and prevented the plaintiff from collapsing the system into a single enterprise. For franchisors using multi-tier growth models, consistent use of distinct agreements, bank accounts, and management oversight helps preserve this separation.
Finally, the court’s reliance on the FSBOA’s trademark exemption reinforces a broader national trend. Courts have repeatedly declined to extend business-opportunity laws to bona fide franchise or trademark licensing systems that operate under established brands. By anchoring their relationships in trademark licensing and excluding any “marketing or sales program,” franchisors can fall outside the statutory definitions that often ensnare less formal distribution systems.
Taken together, MI-BOX of North Florida provides a clear roadmap for franchisors. Strong choice-of-law and forum provisions, strict entity separation, and reliance on trademark licensing as the defining feature of the relationship can collectively insulate a system from state franchise and business-opportunity claims. The result is a measured, franchisor-protective opinion that underscores the importance of contractual and structural precision in multistate expansion.
This article is based solely on the opinion of the Court in this matter. The author has not conducted any independent investigation into the facts. For the avoidance of doubt, each statement related to the law and facts in this article is drawn from the Court’s opinion in this case.
Thomas O’Connell is a Shareholder at Buchalter APC and Chair of the firm’s Franchise Practice Group. For questions about this article or media inquiries, you can contact Tom at toconnell@buchalter.com.
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