BP has established a settlement fund to compensate economic losses incurred following the 2010 Deep Water Horizons Oil Spill.  And franchisors and franchisees alike are cashing huge in their share of the 20 billion dollars likely to be handed out in 2014 and 2015. More than 3 billion dollars have already been handed out.

Maybe you have heard from a family member or a friend who has already filed a claim.  But chances are just as good that you have tuned out these messages, or haven’t paid them much attention.  Most Franchisors assumed their franchisees do not qualify, or that because their headquarters are outside the gulf states they don’t either.  Often–too often this is a wrong assumption and risks leaving millions of dollars in compensation behind. Because so, chances are even better that your franchise company, or its suppliers, or one of someone you or they know is entitled to receive hundreds of thousands, or even millions in compensation, but you or they just haven’t looked into it. 

While you may know that that the massive oil spill caused significant damage to our environment and our economy, you probably don’t know that BP, by way of a class action settlement, has set aside billions of dollars compensate eligible Gulf State businesses – including those not situated directly along the coastline. And, to date, BP has already paid billions to businesses just like yours.

But there is something very important that most business owners don’t realize: They do not need to prove that the oil spill caused them to lose money.

This is important!  As part of the settlement covering tens of thousands of businesses, BP agreed to a settlement that allows qualifying businesses to file a claim, without forcing those businesses to offer separate proof that the oil spill was the cause of their loss.

How do franchise businesses qualify?

The method is simple.  They need to have to have business operations in the settlement zone that consists of any of the west coast counties of FL, or any county of AL, LA or MS, and have to have suffered a downturn in gross revenues during the latter part of 2010 according to a settlement formula.

But, they don’t have to do the math and understand the 1000+ page settlement on their own.  Consulting firms, like www.gulfrecoverysolutions.com (which was founded by professionals in the franchise industry) will work with your franchise businesses to apply this geographic and mathematical test, to determine if you qualify. The franchisor or franchisee’s headquarters does not need to be in a gulf coast state as long as it has a physical business operations located in the settlement zone.

Why should franchisors, franchisees and their counsel care?

First.  Most franchisors can receive royalties on the recoveries by their franchisees. This can be substantial if they have dozens, or hundreds of franchisees receiving awards in the hundreds of thousands, or million each.

Second.  Franchisors with physical operations in the geographic area covered by the settlement can collect handsomely. Many franchisors and franchisees qualify for a multiplier of between1.25 and 3 times the actual calculated losses. Well funded franchisors and franchisees are good for the entire franchise system, and fund recoveries can be used for brand improvements and expansion.

Third.  When franchisors or franchisees are working with a firm familiar with the nuances of franchising, like www.gulfrecoverysolutions.com , they can actually harness the power of their customer and business contacts to refer claims and be paid huge referral/consulting fees for doing so.

Fourth.  For franchisors, www.gulfrecoverysolutions.com will make a contribution back to a franchisor’s ad fund or charity of its choice from its revenues when the franchisor establishes a national account program with them.

Better yet: it doesn’t cost franchisors, their franchisees, suppliers or customers a penny to find out if they qualify.

Nor does it require complicated or time consuming input from the franchise businesses. Gulf Recovery Solutions (www.gulfrecoverysolutions.com) handles the calculations and data collection for them. And, once you qualify GRS will work with experienced attorneys and accountants to properly value and support the filing of your claim.   As a result, they won’t owe GRS, the attorneys or accountants any fees or costs unless and until they are able to recover money from BP.

GRS and others have already helped numerous franchise systems run qualification and valuation analysis for hundreds of franchise locations. The process is fast and efficient, but time is running out. The deadline for claims is approaching. Your delay could cost you a lot of money.

Joe Weber is a franchise industry claims specialist within GRS.  

Give him a call at 863-510-7645 or email at j.weber@gulfrecoverysolutions.com

(GRS does not provide legal services.)