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Franchise Law Update Commentary on Business and Legal Issues of Franchising

ADA Compliance Trumps Aesthetics in Hollister Disability Case

Posted in Legal Decisions, Uncategorized

shoppingmallThe cornerstone of a successful franchise brand is uniformity in display and design so potential customers can recognize a store or outlet as part of the franchise system. The recent case of Colorado Cross-Disability Coalition v. Abercrombie & Fitch Co., however, reminds franchisors not to place hip and inviting aesthetics over legal compliance.

Two Colorado residents along with the non-profit organization the Colorado Cross-Disability Coalition brought the original 2009 case alleging that a Denver Hollister store entrance violated the Americans with Disabilities Act (“ADA”). A class action was certified in April 2012 to include all persons who use wheelchairs and who were denied access to a Hollister store location within the previous 2 years. In August, the United States District Court for the District of Colorado granted a permanent injunction ordering the clothing giant to redesign over 200 of its Hollister Co. locations nationwide to make them more wheel chair accessible. Last month the court entered final judgment requiring Hollister to bring all stores into compliance by 2017 at a rate of not less than 77 stores per year.

The signature design of a Hollister store entrance is the dark wood raised front porch. Hollister defended the entrance explaining that it is meant to make customers feel like they are entering a Southern California beach house. While each of the Hollister stores contained a secondary accessible entrance for individuals using wheelchairs, the Colorado court deemed the entrances smaller and inferior because they did not provide class members “full and equal enjoyment of the goods, services, facilities, privileges, advantages” provided at the Hollister stores under Section 12182(a) of the ADA. The court suggested that Hollister flatten out the entranceway or replace the step with a ramp. The decision highlights some important practice pointers for franchisors:

  • First, make sure that any common design used when constructing company owned outlets provides not only a wheel chair accessible entrance but an entrance that is not qualitatively different or inferior to the inaccessible entrance. The accessible entrance used by Hollister was a side door disguised as a window shutter which the plaintiffs established was often blocked by clothing displays. All customers must be entitled to have the same experience regardless of disability.
  • Second, review your franchise agreement’s provisions regarding site approval and construction. It is common for a franchisor to provide design templates and layouts for outlet locations. If you provide such templates then make sure any alternative entrance template meets ADA standards.
  • Finally, templates are just outlines. Franchisees are almost always required to hire an architect who will design a specific blueprint for its particular franchise site location. It is also common to require franchisor approval of the franchisee’s architect designs. Approval of a design, however, should not shift the responsibility of legal compliance to the Franchisor. The franchise agreement should clearly set the ultimate responsibility for ADA compliance with the franchisee.

It is fine to set a certain tone or feeling with an interesting or elaborate entranceway so long as that experience is accessible to each and every potential customer. Failure to ensure that your entrance and exits are ADA compliant can have huge financial consequences for both franchisors and franchisees.