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opinion of the court corp., 340 mass. 124, 129130, 163 n. e. 2d 4, 78 (1959). but as even supreme court of the united states under the act.11 expand federal law into a domain traditionally reserved tinue, or renew" the franchise relationship once a fran- signed to motiva its rights and obligations under the requires district courts to grant preliminary injunctive the plaintiff, not the defendant, formally ends a particular legal rela- at 389; see also random house, supra, at 215 ("to make ------------ implications for run-of-the-mill franchise disputes. the act requires post-termination violations. it does not suggest that by the act. prior to the pmpa, franchisors often leveraged their stances in which petroleum franchisors may "terminate" a dealers' constructive nonrenewal claims necessarily failed franchisee could simply sign the new franchise agreement force an end to the franchise. alito, j., delivered the opinion for a unanimous court. if an agreement for the use of a trademark, purchase of sions of the act meaningless. respondents' brief 2122, has been no "fail[ure] to renew," and thus the franchisee renewal agreements "under protest," and they argue that cast a cloud of uncertainty over all renewal agreements that would expand the act in such a fashion.13 such relief. 2805(b)(2). "under protest" did not preserve the dealers' ability to assert nonre- new agreement objectionable. but the act prohibits only written notice, 2802(a)(b), and specifies that "`termination' in- terminated due to the destruction of the service station any franchise," except for an enumerated reason and after giving and motiva said was a necessary element of any construc- 2 shell oil products company llc, another party in this litigation, is that "[t]he term `termination' includes cancellation," tion in these analogous legal contexts. see fitzgerald v. 19cite as: 559 u. s. ____ (2010) lenge. as explained, the pmpa was enacted to address chisor had constructively "terminate[d]" their franchises "in good faith and in the normal course of business" and - as the breach resulted in "such a material change that it burden of showing a "nonrenewal of the franchise rela- 880, 892894 (ca9 1994) (insured who accepts a successor insurance * * * ii the statute. 15 u. s. c. 2802, 2804. consistent with the courts to award attorney's fees and expert-witness fees in any case in maintain a constructive termination claim on the basis of opinion of the court explains why the dealers are wrong to suggest that our holding will shell oil prods. co., 524 f. 3d 33, 37, n. 1 (ca1 2008). opinion of the court does not necessarily mean that a franchisee must go out of 14 mac's shell service, inc. v. shell oil under the act. the act's text leaves no room for such an interpreta- termination "has been terminated" within the meaning of 16 mac's shell service, inc. v. shell oil others have reserved judgment on the issue. see, e.g., abrams shell v. tively ending a franchise, even though the franchisee in justifies its ending of the contractual relationship. a "termination" motor fuel, or lease of a premises is "put [to] an end" or opinion of the court can nonetheless maintain a claim for "constructive nonre- 404 u. s. 336, 349 (1971).7 nation doctrine as applied in analogous legal contexts--e.g., employ- relationship." 2801(14). thus, the threshold require- end" or "annul[ed] or destroy[ed]." thus, the act prohibits only fran- (4th ed. 2007); 3 l. larson, labor and employment law 2 mac's shell service, inc. v. shell oil franchise agreement. the district court denied these shell oil products company llc, et al. pmpa substantially relaxes the normal standard for obtaining prelimi- rule under that doctrine is that a tenant must actually franchisee that chooses to accept a renewal agreement costs, and equitable relief. see 2805(b), (d). the act also chisees a rent subsidy that reduced the monthly rent by a this claim, and the court of appeals affirmed. 524 f. 3d, at 51. that 10 mac's shell service, inc. v. shell oil that a petroleum franchisor and its assignee had constructively "ter- new agreement. nonrenewal takes effect. 2804(a)(2). once the franchisee *together with no. 08372, shell oil products co. llc et al. v. mac's notice of discharge can be accurately described as having co. v. winterboer, 513 u. s. 179, 187 (1995). 2 mac's shell service, inc. v. shell oil franchisor's trademark, as well as any associated agree- before they can obtain preliminary relief and thus will filed suit against shell and motiva in federal district 8 mac's shell service, inc. v. shell oil opinion of the court mine this procedural mechanism and, in the process, renewed franchise agreement cannot maintain a claim for 2801(17), but it does not further define the term "termi- ment. accepting the dealers' argument, therefore, would inc.); id., at 185186, 268269 (sid prashad); id., at 190, 312313 (j & chisor may "terminate" a "franchise" during the term it is so ordered. regulate every aspect of the petroleum franchise relation- and affirmed in part. the cases are remanded for further the petroleum marketing practices act (act) limits the circumstances f. 3d, at 46. but surely these same factors compel em- force an end to the petroleum franchise relationship. see, to enforce these provisions, a franchisee may bring suit given above, we agree with the court of appeals that a solving disputes over the legality of proposed new terms. whether a breach is serious enough effectively to end a franchises "prior to the conclusion of the term" stated in their franchise doctrines of constructive termination in other contexts was and the station subsequently is rebuilt). the second ac- that conduct. ------------ preliminary print of the united states reports. readers are requested to identifying those breaches of contract that should be treated as effec- question. while we do not decide whether the pmpa contemplates prohibits, not just unlawful terminations and nonrenew- policy cannot maintain a claim for constructive nonrenewal of the to use the franchisor's trademark, and agrees to sell motor 2805(d)(1)(c). the act also permits punitive damages, 2805(d)(1)(b), move out in order to claim constructive eviction. see id., opinion of the court ing that the act does not require a franchisee to abandon its fran- business before motiva eliminated the subsidy, and he never claimed syllabus of disputes between petroleum franchisors and franchi- notice: this opinion is subject to formal revision before publication in the because none of the dealers in this litigation abandoned changed so materially as to make success impossible." 524 signs a renewal agreement--even "under protest"--there action for constructive termination. see, e.g., 524 f. 3d, at 4445 (case opinion of the court conduct of which they complained had not compelled any the plain text of the statute leaves no room for a fran- ing franchisees both to sign a franchise agreement and to the act once the franchisee receives notice of nonrenewal. indeed, the v. cumberland farms, inc., 940 f. 2d 744, 746747 (ca1 1991). by 12 the availability of preliminary injunctive relief under the act also tion provisions. after their franchise agreements expired, moreover, is irrelevant. many of them. the dealers asserted these claims even though they specifying that the act covers "cancellation[s]" as well as "termina- constructive eviction. sions," we believe our interpretation is faithful to this tion" rather than a "termination." franchise or "fail to renew" a franchise relationship. syllabus wide range of remedies, including compensatory and fuel to the franchisee for resale. franchise agreements of them to abandon their franchises and even though they mac's shell service, inc., et al. v. shell oil conclusion follows even if congress used "terminate" and "cancel" in 2805(b)(2)(a)(i), even though the termination "takes ------------ use of the franchisor's trademark, purchase of the franchi- 5cite as: 559 u. s. ____ (2010) chise agreement expired. but if a franchisee signs a re- inappropriate because "sunk costs, optimism, and the cline to renew a franchise relationship and leaves undisturbed state- claim for unlawful nonrenewal under the pmpa "where than favorable to the franchisee. a franchisee that signs a view, and in the view of the court of appeals, the pmpa tionship," 2805(c), and thus necessarily cannot establish that the termination claims under the pmpa. at the time when it nonrenewal. see american cas. co. of reading, pa. v. baker, 22 f. 3d appeals for the first circuit note: where it is feasible, a syllabus (headnote) will be released, as is in affirming the judgment on the dealers' constructive the petroleum marketing practices act (pmpa or act), tion. by requiring franchisors to renew only the "franchise opinion of the court answers to these questions. nor could they. any standard that "no franchisor . . . may . . . terminate any franchise," declaratory relief without abandoning the premises--although the court chises]." 524 f. 3d, at 46 (internal quotation marks omitted). that franchisor.1 2801(1). the act defines a "franchise rela- a different understanding should apply to constructive that his decision to leave had anything to do with motiva's rent policies. 1(slip opinion) october term, 2009 dealers' assertions, therefore, our interpretation of the act opinion of the court that does not force an end to the franchise. that argu- sor's fuel, or occupation of the franchisor's service station. operate under the new agreement or, if the terms of the effect" on a later date, just as an employee who receives law regulation of other types of disputes between petroleum franchi- 148153, 324325 (john a. sullivan). these dealers necessarily cannot a renewal agreement. signing a renewal agreement does those terms their ordinary meanings. see asgrow seed constructive termination based on the subsequent franchise agree- united states ex rel. eisenstein v. city of new york, 556 (internal quotation marks omitted). a franchisee presented with a wholly owned subsidiary of shell oil company. see brief for peti- indeed, that happened in this very lawsuit. the dealers franchise relationships. see 15 u. s. c. 2806(a). outside prepared by the reporter of decisions for the convenience of the reader. sors and franchisees, see 2806(a). this conclusion is also informed the second question we are asked to decide is whether a wrongful conduct did not compel the franchisee to aban- that gives effect to all of their provisions," united states ex rel. eisen- the breach resulted in "such a material change that it effectively ended 13 it also is worth noting that, although the concept of "constructive nate[d]" in either the ordinary or technical sense of the tive nonrenewal. we therefore reverse in part and affirm recognized the concept of constructive eviction. see ra- agreement complained of." id., at 49. the court thus ington, d. c. 20543, of any typographical or other formal errors, in order order to obtain rescission. see charles e. burt, inc. v. seven grand station premises. for many years, shell offered the fran- ments of a typical petroleum franchise. 2801(1). thus, ------------ 11cite as: 559 u. s. ____ (2010) cases of actual termination, the act requires franchisors to that is consistent with this well-established body of law. pmpa permits constructive termination claims at all, see n. 4, supra, maintaining the status quo while a court determines the with written notice well in advance of the date when the products co. formula. but in that circumstance, a franchisee would not only have a surefire to the dealers. although it would allow a tenant to bring a constructive & p. grossman, employment discrimination law 1449 appeals' unwillingness or inability to establish a more concrete stan- circumstances in which franchisors may terminate a franchise or de- motions, and shell and motiva appealed. ------------ mac's shell service, inc., et al., petitioners the dealers' own experience demonstrates that franchisees claiming constructive termination is also consistent with the first circuit affirmed in part and reversed in part. the first circuit to the dealers' nonrenewal claims. company (shell), a petroleum franchisor, and several newal claims. when a franchisee signs a renewal agreement--even termination claim under the act is that the franchisor's chise or decline to renew a franchise relationship. see 15 2106(3) (1972 ed.). by contrast, a "cancellation" occurs when "either held: opinion of the court continued to operate [its franchise]." id., at 46 (internal dard underscores the difficulties and inherent contradictions involved the franchisee to occupy a service station owned by the observed that the tenant still would have to abandon the premises in and had constructively "fail[ed] to renew" their franchise see id., at 202207. force franchisees "to choose between accepting an unlawful and coercive the act's structure and purpose confirm this interpreta- "the franchise of which he is a party has been terminated." franchise to end would ignore the act's scope, which is limited to the contract in order to stay in business [or] rejecting it and going out of prohibits only that franchisor conduct that has the effect sees. see 2806(a) (pre-empting only those state laws franchisors can respond to market demands by proposing with a franchisor may not maintain a claim for construc- indeed, in the court of appeals, the dealers abandoned any claim for "contrary to the present weight of judicial authority." 1 restatement (1982); 1 h. tiffany, real property 141, 143 (3d ed. their favor on their state-law claims and awarded them breach is not covered by the act because it is technically a "cancella how courts applied the doctrine of constructive termina- the dealers would have us interpret the pmpa in a direct operation by the franchisor. 2802(b)(3)(a). addi- tinued operating their franchises for the full terms of their franchise the rent subsidy not only constructively terminated their this litigation involves a dispute between shell oil pmpa fails to provide franchisees with much-needed and motiva, by eliminating the rent subsidy, had "con- if the parties cannot agree, the franchisor has the option providing the franchise elements for the duration of the litigation. 2008). nonetheless, shell representatives made various of those areas, therefore, franchisees can still rely on 929 (ca10 1975). similarly, landlord-tenant law has long uniform commercial code, as adopted in massachusetts, by setting 1 courts sometimes describe these three types of agreements as the with the act's restrictions on terminations and nonrenew- a "franchise relationship" at the conclusion of that term tions in the eastern united states. id., at 37. shell as- leum industry. see, e.g., comment, 1980 duke l. j. 522, amount to constructive termination if the breach resulted in a mate- "any contract" that authorizes a franchisee to use the was most concerned: the imposition of arbitrary and un- by independent franchisees. in the typical franchise share with a franchisee certain parts of a condemnation chisee to claim that a franchisor has unlawfully declined state-law remedies available to them. the pre-emptive specify that "cancellation[s]," no less than "termination[s]," are covered in which franchisors may "terminate" a service-station franchise or can opt to renew the franchise relationship by executing a void; revoke; annul"). the object of the verb "terminate" is 9 the government reads the act to permit a dealer to seek prelimi- technical breaches by the franchisee. see, e.g., chestnut hill gulf, inc. franchisee a right of first refusal if the franchise was shell oil products company llc, et al., the franchisee has signed and operates under the renewal 846, 861 (ca7 2002); comment, 32 emory l. j. 273, 277 pretation principle that statutes should be construed "in a manner sor liability under the act to that with which congress eighth had sold his franchise prior to the expiration of his requiring franchisees to abandon their franchises before 13cite as: 559 u. s. ____ (2010) could seek a preliminary injunction forcing the franchisor to resume subsidy. see app. 161, 164, 316321 (mac's shell service, inc.); id., at that a court will ultimately determine that the proposed 17cite as: 559 u. s. ____ (2010) their technical, rather than ordinary, senses. this conclusion is also premises to the franchisee, grants the franchisee the right u. s. ___, ___ (2009) (slip op., at 5) terms that the dealers had enjoyed for years, increasing costs for the words "terminate" and "cancel" in their technical, relationships. they asserted these claims even though the ------------ tioners in no. 08372, p. iii. the lease, even though the plaintiffs continued to operate [their fran- barnes v. gorman, 536 u. s. 181, 187188 (2002). accepting the extend the reach of the act much further than its text and tations period governing pmpa claims runs from the later als. see 2805. successful franchisees can benefit from a unreasonable prices under the open-price terms of their fuel-supply 2805(c)--is that the franchisor did not "reinstate, con- lish language 1465 (1967). the term "cancel" carries a franchisee who is offered and signs a renewal agreement for conduct that does not force an end to a franchise would 2802. the act defines the term "fail to renew," in turn, claims. they argued that they could not be found liable 1975); muller v. united states steel corp., 509 f. 2d 923, notify the reporter of decisions, supreme court of the united states, wash- purchase the franchisor's fuel for resale. 2801(1). as relevant here, serious questions going to the merits" that present "a fair that the franchisor has violated the act. newals, not to govern every aspect of the petroleum fran- 1957); see also the random house dictionary of the eng- 15cite as: 559 u. s. ____ (2010) punitive damages, reasonable attorney's fees and expert under state law. additionally, the dealers asserted two franchise when the franchisee is still willing and able to tion of the rent subsidy constituted a breach of contract establish that the elimination of the subsidy "terminate[d]" their cludes cancellation," 2801(17). because it does not further define rial change effectively ending the lease. however, the court reversed shell franchisees in massachusetts.2 pursuant to their renewals of a franchise relationship on terms that are less motiva to extend the term of his franchise agreement, id., at 330331. greater bargaining power to end franchise agreements for minor or 2801(2). jury found against shell and motiva on all claims. both franchisor seeks nonrenewal, the franchisee runs the risk 5 the difference between a "termination" and a "cancellation" under that are not designed to convert the service station to business in order to preserve a cause of action." respondents' brief 51 fact continues to use the franchisor's trademark, purchase dealers' reading of the statute, therefore, would turn everyday contract argument misunderstands the legal significance of signing 2801(14). a franchisee that signs a renewal agreement cannot carry little authority on this concept supports our conclusion that a plaintiff terms is worth risking the nonrenewal of the franchise the franchisor's fuel, and occupy the service-station prem- statutes "in a manner that gives effect to all of their provi- "fail to renew" a franchise relationship. 15 u. s. c. 2802, 2804. structive nonrenewal claims, the first circuit agreed with protections of the act's preliminary injunction mechanism nonrenewal, in which case it must provide the franchisee almost $1.3 million in damages. see app. 376379. thus, for constructive discharge, however, an employee gener- 572 (ca8 1993) (same). products co. sweeping consequences. see, e.g., united states v. bass, injunction if a franchisor pursues nonrenewal. instead, a tive statute-of-limitations accrual dates. the 1-year limi- protection from unfair and coercive franchisor conduct the dealers concede, see tr. of oral arg. 3738, the clear majority of als, but also certain serious breaches of contract that do receives notice of nonrenewal, it can seek a preliminary opinion of the court we hold that a franchisee who is offered and signs a 2802. in these consolidated cases, service-station fran- ------------ tion gives meaningful effect to the act's preliminary injunction provi- 12 mac's shell service, inc. v. shell oil of either (1) "the date of termination of the franchise" or end to the franchise, in contrast, is not prohibited by the structive termination claim under the pmpa is that the cumstances in which franchisors may terminate a fran- gives meaningful effect to the pmpa's preliminary injunc- effect." 2804(a). a franchisee that receives notice of the noun "franchise," a term the act defines as "any con- products co. formula for calculating rent. for some (but not all) of the franchises in violation of the pmpa but also amounted to would frustrate franchisors' ability to propose new terms. terms were lawful under the pmpa. see 2802(b)(3)(a). because seven of the eight dealers had signed and oper- 11 as is true with respect to the dealers' constructive termination to reinstate, continue, or extend the franchise relationship," franchise relationships.3 allowing franchisees to pursue nonrenewal claims even opinion of the court unlawful. and because the pmpa has a 1-year statute of products co. relevant franchise agreements. motiva, in turn, took two under the dealers' theory, franchisees have no incentive to relationship; if the franchisee rejects the terms and the actions that led to this lawsuit. first, effective january 1, for constructive termination under the pmpa. see 524 agreement. to that end, the act authorizes franchisors to that risk acts as a restraint, limiting the scope of franchi- tionable new terms must decide whether challenging those (2) "the date the franchisor fails to comply with the re- formula amounted to a "constructive nonrenewal" of their new and different terms at the expiration of a franchise ground for litigation" and the balance of hardships favors as to the constructive nonrenewal claims, holding that such a claim of contract by an assignee of a franchise agreement can had been offered and had accepted renewal agreements. agreement later proved unfavorable, bringing suit under structure suggest. prior to 1978, the regulation of petro- ------------ certiorari to the united states court of appeals for no. 08240. argued january 19, 2010--decided march 2, 2010* chisee who continues operating a franchise--occupying the continue[d], or extend[ed]" the franchise relationship. and permits the franchisee to use the franchisor's trademark and petroleum franchises or the nonrenewal of petroleum crual date listed in 2805(a), therefore, shows only that erate, would be indeterminate and unworkable. pp. 612. 3cite as: 559 u. s. ____ (2010) (second) of property 6.1, reporter's note 1, p. 230 (1976). tion. it is violated only when a franchisor "fail[s] to renew" a fran- as generally understood in these and other contexts, a syllabus nonetheless, courts have long required plaintiffs asserting ------------ except for an enumerated reason and after providing 92 stat. 322, 15 u. s. c. 2801 et seq., limits the circum- dents in no. 08372, pp. 2835 (hereinafter respondents' newal agreement, the franchisor clearly has "reinstate[d], one dealer did leave his franchise before his franchise agreement has no cause of action under the act. see 15 u. s. c. breach of contract by an assignee of a franchise agreement can been discharged, even though the employee's last day at being done in connection with this case, at the time the opinion is issued. b ------------ minate[d]" their franchises and constructively "fail[ed] to renew" brief); 524 f. 3d, at 4447. reading the act to prohibit motiva's elimination of the rent subsidysomething shell the first question we are asked to decide is whether a 6 before congress enacted the pmpa, at least one court, it is true, pmpa, those terms had established meanings under the the word "terminate" ordinarily means "put an end to." now and at the time congress enacted the pmpa--a each franchise agreement expired, motiva offered the tionally, the act creates a procedural mechanism for re- relief to aggrieved franchisees, if there are "sufficiently help avoid. see, e.g., u. c. c. 1207, 1 u. l. a. 318. chise to recover for such termination, and concluding that a simple see united states v. detroit timber & lumber co., 200 u. s. 321, 337. restraint and thus permit franchisees to challenge a much 524 f. 3d 33, reversed in part, affirmed in part, and remanded. 2805(a). sponsibilities" that result from the franchise arrangement. 1939).6 after not providing the required notice. see 15 u. s. c. leum franchise agreements was largely a matter of state we need not address shell and motiva's alternative argument that the edly wrongful conduct did not force the franchisee to decline to renew a franchise relationship if the franchisee who signs a new agreement cannot maintain a claim for constructive petroleum refiners and distributors supply motor fuel to authority required a tenant to leave the premises before claiming governing the termination and nonrenewal of petroleum newal" under the pmpa. for reasons similar to those u. s. c. 2802; dersch energies, supra, at 861862. con- franchisor pursues nonrenewal, seek a preliminary injunction under opinion of the court in crafting a standard for finding a "termination" when no termination those terms, they are given their ordinary meanings: "put [to] an tent with the act's limited purpose and would further that corrections may be made before the preliminary print goes to press. op, at 1112). and in the absence of any contrary evi- justice alito delivered the opinion of the court. relationship for a reason not provided for in the act or 18 mac's shell service, inc. v. shell oil do not need a pmpa remedy to have meaningful protec- 59.05[8] (2009); 2 eeoc compliance manual 612.9(a) expired. app. 204, 330331 (stephen pisarczyk). but that dealer not a remedy ordinarily not available in breach-of-contract actions, see provide franchisees with written notice of termination well i _________________ to a pmpa termination, when all three statutory elements ments. see appellees' brief in no. 052770 etc. (ca1), p. 40, n. 29. (2008); cf. suders, supra, at 141143, 148; young v. south- don its franchise. additionally, we conclude that a fran- the franchisee bears the burden of establishing, see spread concern over increasing numbers of allegedly un- f. 3d, at 4547. instead, the court ruled, a simple breach 1cite as: 559 u. s. ____ (2010) the franchisee to abandon its franchise. pp. 615. ------------ terpretation. accepting the dealers' contrary reading would greatly 4 mac's shell service, inc. v. shell oil nation or taking); 2802(d)(2) (franchisor must grant a the nonrenewal of the franchise by mounting a legal chal- when given its ordinary meaning, the act is violated only nary injunctive relief if a franchisor announces its "intent to engage in only continued to operate for seven months after the subsidy ended, id., opinion of the court we granted certiorari. see 557 u. s. ___ (2009). above a specified threshold. shell renewed the subsidy motiva's elimination of the rent subsidy,10 they cannot unlawful nonrenewal under the pmpa. we therefore "statutory elements" of a petroleum franchise. see, e.g., marcoux v. tion from abusive franchisor conduct. (a) the act provides that "no franchisor . . . may . . . terminate end to the particular legal relationship--not because there well before having to go out of business.9 contrary to the any element of their franchise operations in response to iv 3 the dealers also claimed that shell and motiva had violated the same trademark--has not had the franchise "termi- 283 (1983). in enacting the pmpa, congress did not 08372 v. ises.8 we think any such standard would be indetermi- supreme court of the united states act's plain terms. availability of state-law remedies to address such wrongful conduct. 3cite as: 559 u. s. ____ (2010) in order to maintain a claim for constructive termination. 143 (2004) (tracing the doctrine to the 1930's). to recover ------------ for similar reasons, the second restatement of property is of no help manner that ignores the act's limited scope. on their pmpa does not embrace claims for constructive termination at all. argued in the district court that motiva's elimination of congress intended franchisees to maintain claims under receive notice of impending termination can invoke the annually through notices that "explicitly provided for object to burdensome new terms and seek a preliminary cannot be maintained once a franchisee signs and operates under a affirm the judgment of the court of appeals with respect similar meaning: to "annul or destroy." webster's, supra, of ending a franchise. as relevant here, the act provides it is possible, of course, that a franchisor could fail to renew a fran- reasonable new terms on a franchisee that are designed to agreements with the dealers. the jury found in favor of the dealers on the syllabus constitutes no part of the opinion of the court but has been in advance of the date on which the termination "takes termination under the pmpa when the franchisor's alleg- needs. 20 mac's shell service, inc. v. shell oil at 75; glendon, the transformation of american land- simple breaches of contract, however, would be inconsis- abandon its franchise. for the reasons that follow, we e.g., ibid.; comment, 32 emory l. j., at 277283. allow- additionally, allowing franchisees to obtain pmpa relief which a plaintiff recovers more than nominal damages. see 15 u. s. c. * * * in federal court against any franchisor that fails to comply fore do not express a view on that question. such claims to show an actual severance of the relevant mac's shell service, inc., et al. agreements. 15 u. s. c. 2802(a)(1). whether they ceased operations the dealers also charge that this interpretation of the amount to constructive termination under the act, so long occupation of the franchisor's service station.4 the plain text of the statute, a franchisee faced with objec- had not been compelled to abandon their franchises, and even though 2000, motiva ended the volume-based rent subsidy, thus their franchise relationships by substantially changing the rental chisee is not required to abandon its franchise to recover service-station franchisee may recover for constructive has in fact occurred. the limitations period runs from the date of these types of render useless the act's preliminary injunction mecha- eviction claim without moving out, it noted that this proposition was state-law remedies to address wrongful franchisor conduct limitations, see 2805(a), franchisees would retain that chise relationship. see supra, at 10; dersch energies, 314 new arrangements work, even when the terms have remain in effect for a stated term, after which the parties our interpretation also gives effect to the act's alterna- for identifying when a simple breach of contract amounts see 2802; see also 2801(2), the pmpa contemplates that that difference might well explain why congress felt compelled to act. second, they claimed that motiva's offer of new fran- products co. typically, the franchisor leases the service station to the franchisee products co. relationship," as opposed to the same franchise agreement, 15 u. s. c. 2805(b)(2)(a)(i) (emphasis added). but that stated in the franchise agreement and may "fail to renew" termination is deemed "constructive" because it is the required to pay shell monthly rent for use of the service- erning petroleum franchise agreements, we decline to tive termination claim. similarly, they argued that the 2. a franchisee who signs and operates under a renewal agreement the general understanding of the doctrine of constructive 7cite as: 559 u. s. ____ (2010) states as amicus curiae 21. because we do not decide whether the lowing franchisees to obtain relief for conduct that does not force a after a 2-week trial involving eight of the dealers, the renewal agreement, in short, cannot carry the threshold with a franchisor may not maintain a constructive nonrenewal claim the act if the franchisor's allegedly wrongful conduct did not compel to renew a franchise relationship--constructively or oth- provide franchisees with protection from unfair and coercive franchi- _________________ response to changing market conditions and consumer claim for unlawful nonrenewal, see 2802(b)(1)(a), but also presumably 8 the first circuit, for example, approved of a test that asks whether termination under the pmpa if the franchisor's allegedly shell service, inc., et al., also on certiorari to the same court. true, the franchisee might find some of the terms in the shell oil co., 343 f. 3d 482, 486488 (ca5 2003); portland 76 party puts an end to the contract for breach by the other." 2106(4). standard, it seems to us, does little more than restate the relevant franchisees, annual rent was greater under the new service-station franchisees (dealers) filed suit under the act, alleging franchises. under the act's operative provisions, a fran- franchise agreement. as relevant here, a franchisor vio- western savings & loan assn., 509 f. 2d 140, 144 (ca5 termination claims, the court of appeals held that a fran- pmpa, however, cannot occur until after a franchise has [march 2, 2010] petitioners ment, however, ignores the fact that franchisees still have 524531. the act establishes minimum federal standards instead, signing a renewal agreement negates the very sions and its alternative statute-of-limitations accrual dates. pp. 12 f. 3d, at 861. we thus decline to adopt an interpretation to abandon" one (or more) of the franchise elements. brief for united products co. "unlawful and coercive" terms can simply reject those terms and, if the products co. llc et al. broader range of franchisor conduct--conduct to which the first circuit affirmed as to the constructive termination claims, hold- possibility of a violation of the pmpa. when a franchisee b set amount for every gallon of motor fuel a franchisee sold pmpa cannot be correct because it renders other provi- marcoux v. shell oil prods. co., 524 f. 3d 33, 38 (ca1 dence, we think it reasonable to interpret the act in a way opinion of the court 9cite as: 559 u. s. ____ (2010) violation of the act. the act's structure and purpose confirm this in- the uniform commercial code relates to how the contracting party products co. the pmpa to redress franchisor conduct that does not claims under the pmpa. first, they maintained that shell 14. at 204, but also during that period entered into an agreement with enacted in 1978, the pmpa was a response to wide- injunction under the act's relaxed injunctive standard, dealer might object but not consider so serious as to risk lord-tenant law, 23 boston college l. rev. 503, 513514 not cause an end to the franchise. see brief for respon- 4 because resolving this question is sufficient to decide these cases, 7 adopting such a broad reading of the pmpa also would have serious typical franchise arrangement, a "franchise" is defined as opinion of the court a breach of contract under state law. the jury found in plaintiff must actually sever a particular legal relationship ship but instead federalized only the two parts of that action in question for a reason specifically recognized in complained-of conduct forced an end to the franchisee's plaintiff, rather than the defendant, who formally puts an shell and motiva that a franchisee cannot maintain a supra, at 13.12 "annul[ed] or destroy[ed]." conduct that does not force an conduct that would leave the franchisee no reasonable alternative but with anything close to a meritorious claim to obtain relief. as a "failure to reinstate, continue, or extend the franchise decision. adopting the dealers' reading of the pmpa 2425. while we agree that we normally should construe been terminated. see, e.g., 2802(d)(1) (franchisor must termination. as applied in analogous legal contexts--both they thereby explicitly preserved their ability to assert a the same conclusion follows even if congress was using is no end to the relationship at all. there is no reason why issue is not before us. renewal agreement. cannot thereafter assert a claim for unlawful nonrenewal tionship," 2805(c), and thus necessarily cannot establish enacted the statute, congress presumably was aware of chise relationship without providing the statutorily required notice. the pmpa alleging that the newly imposed terms are 141143--where a termination is deemed "constructive" only because "terminate" will require franchisees to go out of business adopt an interpretation of the act that would have such pacz, origin and evolution of constructive eviction in the barnstable school comm., 555 u. s. ___, ___ (2009) (slip option for the entire first year of a new franchise agree- not constitute a waiver of a franchisee's legal rights-- motor fuel marketing or distribution obligations and re- the court's reading of the act is also faithful to the statutory inter- occurs when "either party pursuant to a power created by agreement or the court of appeals was of the view that analogizing to structively terminated" their franchises in violation of the finally, important practical considerations inform our opinion of the court cancellation [of the rent subsidy] with thirty days' notice." ment providing for the supply of motor fuel or authorizing on writs of certiorari to the united states court of (b) the dealers' claim that this interpretation of the act fails to quotation marks omitted). turning to the dealers' con- claims, it is not necessary for us to decide in these cases whether the stein v. city of new york, 556 u. s. ___, ___, because this interpreta- tionship--not because there is no end to the relationship at all. al- however, a "termination" or "cancellation" occurs only here. chisees would then have the option of either continuing to conduct forced an end to the franchisee's use of the fran- had held that a tenant asserting constructive eviction could obtain same premises, receiving the same fuel, and using the rather than ordinary, senses. when congress enacted the ment law, see pennsylvania state police v. suders, 542 u. s. 129, products co. the public through service stations that often are operated ------------ of either modifying the objectionable terms or pursuing f. 3d 62, 6566 (ca3 1994) (same); adams v. greenwood, 10 f. 3d 568, lates the pmpa only when it "fail[s] to renew" a franchise or something like it would always exist." ibid. habit of years might lead franchisees to try to make the the dealers suggest that this interpretation of the previous policy); american cas. co. of reading, pa. v. continisio, 17 create motiva enterprises llc (motiva), a joint venture jury found against the franchisor and assignee, and the district webster's new international dictionary 2605 (2d ed. expand the act's reach. pp. 1519. a quirements of" the act. 2805(a). some violations of the chisee who signs and operates under a renewal agreement something that signing "under protest" can sometimes pursue a claim under the pmpa would eliminate that written notice. 15 u. s. c. 2802(a)(b). the act specifies auto/truck plaza, inc. v. union oil co. of cal., 153 f. 3d 938, 948 iii by important practical considerations, namely, that any standard for court denied their requests for judgment as a matter of law. the nism. we disagree. to obtain a preliminary injunction, it 138139, 314315 (cynthia karol); id., at 154155, 310311 (akmal, chise relationship for an enumerated reason or fails to provide the in july 2001, 63 shell franchisees (hereinafter dealers) they had been offered and had accepted renewal agreements. the ------------ several courts of appeals have held that the act does create a cause of those state or local laws that govern the termination of we therefore hold that a necessary element of any con- would require us to articulate a standard for identifying after they have signed renewal agreements would under- have been so serious? the dealers have not provided arrangement, the franchisor leases the service-station word. court. their complaint alleged that motiva's discontinua- continue its operations? and how is a franchisor to know chise agreements that calculated rent using a different chisees brought suit under the act, alleging that a fran- the narrow areas of franchise terminations and nonre- sees--to try to make their changed arrangements work. unlawful "fail[ures] to renew" a franchise relationship, not fair franchise terminations and nonrenewals in the petro- tion[s]," congress foreclosed any argument that a termination for to begin, the dealers insist that our reading of the term united states, 1 depaul l. rev. 69 (1951). the general nate" or the incorporated term "cancel." we therefore give products co. when given its ordinary meaning, the text of the pmpa tively ending a franchise, even though the franchisee continues to op- proceedings consistent with this opinion. ment of any unlawful nonrenewal action--a requirement uniform commercial code.5 under both definitions, agreements and then signed new agreements that did not include the the judgment of the court of appeals is reversed in part moreover, that dealer had been planning to leave the service-station oral representations to the franchisees "that the [s]ubsidy v. bp exploration & oil, inc., 115 f. 3d 849, 852853 (ca11 1997). business before obtaining an injunction. for example, in increasing the franchisees' rent. id., at 38. second, as "under protest"--there has been no "fail[ure] to renew," and thus no law puts an end to the contract otherwise than for its breach." u. c. c. claim for unlawful nonrenewal under the pmpa. that chisor's trademark, purchase of the franchisor's fuel, or 106(3)(4), 1 u. l. a. 695, 695696 (2004). thus, a fran- 08240 v. erwise--when the franchisee has in fact accepted a new that does not have the effect of ending the franchise. tionship" in more general terms: the parties' "respective relationship with which it was most concerned: the cir- chisor conduct that has the effect of ending a franchise. the same we hold that a franchisee cannot recover for constructive opinion of the court required notice, see 2802, and it defines "fail to renew" as a "failure (ca9 1998). we leave the question for another day. nary-injunctive relief, 2805(b)(2)(a)(ii), thus allowing a franchisee before and after the jury's verdict, shell and motiva moved nos. 08240 and 08372 for example, courts have long recognized a theory of intended to federalize such a broad swath of the law gov- the dealers had abandoned their franchises in response to consistent with the general understanding of the constructive termi- ployees and tenants--no less than service-station franchi- products co. below); clark v. bp oil co., 137 f. 3d 386, 390391 (ca6 1998); shukla franchisor has violated the act. signing their renewal agreements expand the pmpa's reach. under the balance struck by c franchisees new agreements that contained a different reversed the judgment on those claims. is true, a franchisee must show, among other things, that and could chill franchisors from proposing new terms in work may perhaps be weeks later. thus, franchisees that franchise agreements with shell, each franchisee was governing franchise terminations or nonrenewals). when a contracting party "puts an end to the contract." refuses to accept changes or additions that are proposed in 1998, shell joined with two other oil companies to disputes into high-stakes affairs. 1. a franchisee cannot recover for constructive termination under lawfulness of the proposed changes. see 2805(b)(2); and decide later whether to sue under the pmpa. fran- opinion of the court we need not address this argument. nonrenewal" does not arise frequently in other areas of the law, the nate and unworkable. how is a court to determine opinion of the court m avramidis, inc.); id., at 179182, 322323 (ram corp., inc.); id., at tract" for the provision of one (or more) of the three ele- ------------ award when the termination was the result of a condem- remain operational, simply evades coherent formulation. u. c. c. 2106(3)(4) (1972 ed.); see also u. c. c. 2 gress left undisturbed state-law regulation of other types the threshold burden of showing a "nonrenewal of the franchise rela- act at all recognizes claims for "constructive nonrenewal." we there- those breaches of contract that should be treated as effec- law. see dersch energies, inc. v. shell oil co., 314 f. 3d for constructive termination under the act because none of claims for constructive termination, we observe that the court of pennsylvania state police v. suders, 542 u. s. 129, 141 a that combined the companies' petroleum-marketing opera- effectively ended the lease, even though the [franchisee] ated under renewal agreements with motiva, and the the dealers point out that several of them signed their 6 mac's shell service, inc. v. shell oil "well-established principl[e] of statutory interpretation." for judgment as a matter of law on the dealers' two pmpa conclude that a necessary element of any constructive ally is required to quit his or her job. see 1 b. lindemann finally, accepting the dealers' argument would greatly sor conduct that does not force an end to the franchise ignores the constructive discharge in the field of employment law. see only if the franchisor provides written notice and takes the scope of the pmpa is limited: the act pre-empts only syllabus 10 after motiva withdrew the rent subsidy, seven of the dealers con- for the states. without a clearer indication that congress in part. legal relationship. we see no reason for a different rule in advance which breaches a court will later determine to
Court Critical of Petroleum Franchise Constructive Termination Claims