PALM DESERT, Calif., Sept. 13, 2022 (GLOBE NEWSWIRE) — BrightStar Owners Association (BOA) President Mark Woodsum recently spoke with Beth Ewen of Franchise Times to discuss the ongoing legal challenge to BrightStar Franchising’s added purchase option , LLC (franchisor) on new franchise agreements.

Three BOA-backed BrightStar franchisees sued the franchisor in California last month, and BOA expects this is just the first step in a national legal strategy to illegalize the purchase option in as many jurisdictions as possible. The option to purchase gives the franchisor the right, at its discretion, to terminate the franchise agreement and purchase the franchisee’s assets at a predetermined price that may be less than fair market value, preventing resale in the open market. Since the option to purchase was first disclosed by the franchisor in April, BOA has more than doubled financial contributions to its trust, which supports legal action, among other services benefiting member franchisees.

Woodsum told the Franchise Times that Shelly Sun, the founder of BrightStar, has been open about being in talks with strategic partners and that BOA members believe Sun may want to use the call option to secure a partner, such as the recently announced $8 billion home-buy offer by CVS healthcare provider Signify. Given recent transactions in this space, including Honor Technology, Inc.’s acquisition of Home Statt last year, franchisees do not believe that the option to buy is the only solution for the franchisor to find a strategic partner. A recent survey of its members found that 76% of franchisees would never have purchased a BrightStar Care franchise with the option to buy. However, the owners remain committed to providing their clients locally with the personal and compassionate care they depend on.

Responding to Franchise Times, Sun defended the purchase option, stating that it was necessary for the development of the brand and that it presented an opportunity for franchisees…