Sixth Circuit decision emphasizes that clear sales practices and transparency in communication matter with franchisees

In Fetch! Pet Care, Inc. v. Atomic Pawz Inc., 170 F.4th 546 (6th Cir. 2026), the Sixth Circuit affirmed the denial of a franchisor's request for a preliminary injunction against 31 former franchisees. The decision is a cautionary tale for franchisors: aggressive or misleading sales practices—and abrupt system cutoffs—can bar access to equitable relief when a franchisor might need it.

Fetch! Pet Care is a nationwide pet-care franchisor that operated under three franchise models. Its original "1.0" model charged revenue-based royalties and left franchisees responsible for their own sales and marketing. A newer "2.0" model charged higher fees but included a corporate call center, and a premium "Managed-Services" model was marketed as a passive-income investment.

While many “1.0” franchisees were quite successful, franchisees under the newer models reported they were never profitable, found the corporate support deficient, and were often unaware that different models with different fee structures existed. When roughly 125 franchise locations began to fail, groups of franchisees organized, formed an association, and began seeking rescission of their agreements. In May 2025, Fetch! shut them out of its proprietary software without notice. It then sued 31 former franchisees and sought a preliminary injunction barring them from operating competing businesses.

The district court granted limited trademark relief but denied the broader injunction, finding evidence of Fetch!'s "unclean hands." On appeal, the Sixth Circuit affirmed, finding that for the “2.0” and Managed-Services franchisees, Fetch! aggressively recruited while obscuring the true nature of the business and expected financial performance. The court also found that Fetch! inappropriately cut off the “1.0” franchisees in the organizing group from its system while they were current on payments and before they had competed or misused proprietary information. The court noted Fetch! likely violated state franchise termination laws in Washington, Illinois, and Iowa by failing to provide written notice and a cure period.

This decision emphasizes that a franchisor (or any party) that seeks the extraordinary remedy of a preliminary injunction must come to court with clean hands. Misleading franchise sales practices can shut the door to equitable relief—even if the franchisees breached their agreements.

The court also closely scrutinized changes to Fetch!'s disclosure documents, particularly the removal of distinctions between franchise models. Franchisors should ensure their FDDs and marketing materials are accurate, consistent, and complete. Finally, franchisors operating in multiple states must comply with each state's specific notice and cure requirements before terminating franchisees. Failure to do so can expose the franchisor to additional legal risk.

Practical recommendations

For franchisors:

• Audit your FDD and all marketing materials—including videos and information shared with franchise consultants—to ensure they provide a complete and honest picture of the franchise opportunity.
• If offering multiple franchise models, clearly disclose the differences in fees, support, and expected performance.
• Follow state-specific notice and cure requirements before terminating any franchisee or restricting system access.

For franchisees:

• Document everything: representations made during the sales process, the quality of support received, and your financial performance.
• Understand your rights under applicable state franchise relationship laws, particularly regarding termination notice and cure periods.
• If organizing with other franchisees, do so with the guidance of experienced franchise counsel to maintain credibility and ensure that all procedures are followed.