In Massage Heights Franchising, LLC v. Hagman, , 2025 WL 1978842 (Tex. May 2, 2025) (per curiam), the Texas Supreme Court issued a per curiam opinion—without oral argument—reversing a lower court ruling that had imposed liability on a franchisor for a franchisee’s hiring decision.
The ruling was clear. But the path to that clarity required strategic legal coordination, collaboration, and a deep understanding of how franchise litigation strategy intersects with operational realities.
And while the Court’s decision brought legal resolution, it also marked the beginning of a broader conversation about how franchisors translate legal clarity into operational strategy.
The Role of General Counsel in a Franchise System
Whether in-house or fractional, the General Counsel (GC) plays a uniquely strategic role in a franchise organization. Unlike traditional outside counsel, a GC is embedded in the business—helping leadership anticipate risk, shape policy, and align legal frameworks with brand strategy.
In a franchise system, this role is even more critical. The GC must:
- Understand the nuances of the franchisor-franchisee relationship
- Ensure that operations manuals, training protocols, and compliance systems reflect current legal standards
- Balance brand protection with franchisee autonomy
- Coordinate litigation strategy when needed—while always keeping the broader business model in view
This case underscored how essential it is for franchisors to have legal leadership that can bridge litigation outcomes with long-term brand resilience. This wasn’t just about defending a case—it was about protecting the legal structure of the franchise model itself.
Why the IFA’s Involvement Mattered
The International Franchise Association (“IFA”) filed an amicus brief urging the court to review the case. The IFA’s amicus brief emphasized that the appellate court’s ruling—if left uncorrected—could have destabilized the franchise model in Texas by:
- Undermining the freedom of contract between franchisors and franchisees.
- Creating uncertainty around operational guidance and liability.
- Forcing franchisors to exert more day-to-day control increases risk for all parties.
The Texas Supreme Court’s decision to reverse—without oral argument—sent a strong message: the legal framework was already in place, and the appellate court had misapplied it.
Lessons for Legal Leaders in Franchising
This case reinforced several key lessons for legal professionals working in franchising:
- Clarity in contracts matters—especially around roles, responsibilities, and control
- Legal strategy is proactive—not just reactive
- Industry collaboration can shape outcomes—especially when the stakes are systemic
- Legal leadership must extend into the operational decisions that define how a franchise system functions, scales, and protects its brand
Looking Ahead
In Part 3 of this series—From Courtroom to Playbook—I’ll explore how this ruling informs the way franchisors can structure operations manuals, compliance frameworks, and internal policies to align with both legal precedent and business goals. I’ll also share how Endereza helps put this framework into action.
Elena Sullivan, founding and principal attorney to Endereza Law, PLLC, served as in-house General Counsel for Massage Heights from June 2022 – May 2024, and Endereza has served as fractional GC to Massage Heights since June 2024. During this time, Elena collaborated with this case’s appellate counsel (Rachel Stinson and Jessica Barger of Close, Barger, Wright) and trial counsel (Forrest Wynn and Pamela Hicks of Davis, Hicks, Wynn).
The information provided in this article is for general informational and educational purposes only. It does not constitute legal advice and is not intended to be a substitute for legal advice from a qualified attorney in your state. Your use of this information does not create an attorney-client relationship between you and Endereza Law, PLLC or Elena Villasenor Sullivan.
