Robert Hanley

What Hanley will NOT PROVIDE in his
Franchise Disclosures
• A detailed list of current and projected units in the system, broken down by all 50 states
• Names and contact information of former and current franchisees in the franchise
system (great for speaking with those who know the system best, marketing to
franchisees, or conducting research surveys)
• Historical franchise financial performance figures (critical for building financial models
and business plans)
• Earnings claims tables (for franchisors supplying Item 19s)
• Franchise litigation and bankruptcy history of his Franchise
• FDD Items 3-4 provide information on past bankruptcy filings as well as past and/ or
current litigation that the franchise may be involved in.
• FDD Item 19 (when applicable) provides a summary of store-level (unit-level) financial
performance• FDD Item 20 provides listings of
(and contact information for) existing and former franchisees in the system – an
invaluable tool for research and due diligence.
• FDD Item 21 reveals the franchisor’s financials, including audited balance sheets and
income statements for the 3 previous fiscal years

10 signs for spotting a sociopath
#1) Sociopaths are charming. Sociopaths have high charisma and tend to attract a following just because people
want to be around them. They have a "glow" about them that attracts people who typically seek guidance or direction.
They often appear to be sexy or have a strong sexual attraction. Not all sexy people are sociopaths, obviously, but
watch out for over-the-top sexual appetites and weird fetishes.

#2) Sociopaths are more spontaneous and intense than other people. They tend to do bizarre, sometimes erratic
things that most regular people wouldn't do. They are unbound by normal social contracts. Their behavior often
seems irrational or extremely risky.

#3) Sociopaths are incapable of feeling shame, guilt or remorse. Their brains simply lack the circuitry to process
such emotions. This allows them to betray people, threaten people or harm people without giving it a second thought.
They pursue any action that serves their own self interest even if it seriously harms others. This is why you will find
many very "successful" sociopaths in high levels of government, in any nation.

#4) Sociopaths invent outrageous lies about their experiences. They wildly exaggerate things to the point of
absurdity, but when they describe it to you in a storytelling format, for some reason it sounds believable at the time.

#5) Sociopaths seek to dominate others and "win" at all costs. They hate to lose any argument or fight and will
viciously defend their web of lies, even to the point of logical absurdity.

#6) Sociopaths tend to be highly intelligent, but they use their brainpower to deceive others rather than empower
them. Their high IQs often makes them dangerous. This is why many of the best-known serial killers who successfully
evaded law enforcement were sociopaths.

#7) Sociopaths are incapable of love and are entirely self-serving. They may feign love or compassion in order to
get what they want, but they don't actually FEEL love in the way that you or I do.

#8) Sociopaths speak poetically. They are master wordsmiths, able to deliver a running "stream of consciousness"
monologue that is both intriguing and hypnotic. They are expert storytellers and even poets. As a great example of
this in action, watch this interview of Charles Manson on YouTube.

#9) Sociopaths never apologize. They are never wrong. They never feel guilt. They can never apologize. Even if
shown proof that they were wrong, they will refuse to apologize and instead go on the attack.

#10) Sociopaths are delusional and literally
believe that what they say becomes truth merely because they say it! Charles Manson, the sociopathic murderer,
is famous for saying, "I've never killed anyone! I don't need to kill anyone! I THINK it! I have it HERE! (Pointing to his
temple.) I don't need to live in this physical realm..."

Learn more: http://www.naturalnews.com/036112_sociopaths_cults_influence.html#ixzz35gvMu1jt


UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF INDIANA
INDIANAPOLIS DIVISION
JOSEPH BAK,
) Plaintiff,
) ) vs.
) 1:09-cv-1196-RLY-DML ) HOME VIDEO FRANCHISING
) CORPORATION d/b/a HOME VIDEO
) STUDIO, HOME VIDEO STUDIO, INC.,
) ROBERT HANLEY, and DENISE
) HANLEY,
) Defendants.
)
ENTRY ON DEFENDANTS’ MOTION TO DISQUALIFY
Defendants, Home Video Franchising Corporation d/b/a Home Video Studios
(“HVF”), Home Video Studio, Inc. (“HVS”) (collectively “Home Video”), Robert
Hanley, and Denise Hanley (collectively “Defendants”), move to disqualify the counsel
of plaintiff, Joseph Bak (“Plaintiff”), pursuant to Indiana Rule of Professional Conduct
1.9. The court, having read and reviewed the supporting and opposing briefs, the relevant
case law, and being otherwise duly advised, now finds that Defendants‟ motion should be
DENIED.
I. Factual Background
Robert Hanley (“Hanley”) is the president and founder of HVS and HVF and is a
resident and citizen of Indiana. (Complaint ¶ 2). Defendants solicited franchisees on the
internet by offering “turnkey” opportunities for individuals to start their own Home
Video
1
Dockets.Justia.com



studio. (Id. ¶ 8). Plaintiff, a resident of Maryland, learned of Defendants‟ franchise
opportunities on Defendants‟ website on May 20, 2008. (Id.). In early June 2008,
Plaintiff traveled to Indianapolis, Indiana to speak with Hanley to gather more
information regarding Home Video and franchise opportunities. (Id. ¶ 9). During the
meeting, Hanley made misrepresentations regarding the business potential and
profitability of a Home Video franchise. (Id. ¶¶ 11-12). One of the misrepresentations
made by Hanley was that Home Video was licensed to sell and promote franchises in
Maryland when, in fact, Home Video had allowed its license to sell and promote
franchises in Maryland to lapse on May 21, 2008. (Id. ¶ 9).
On June 11, 2008, Plaintiff negotiated and signed a Franchise Agreement with
Hanley. (Id. ¶ 12). The Franchise Agreement required Plaintiff to pay $148,505 for, inter
alia, home video equipment that was to be delivered by September 2008. (Id.). Hanley
provided a portion of the home video equipment to Plaintiff, but failed to deliver the
remaining essential home video equipment as promised. (Id. ¶ 15). In addition, Hanley
represented that the equipment was worth $75,000, but Plaintiff later learned that the
equipment was actually worth $40,000. (Id. ¶¶ 2, 12). Hanley later agreed to refund all
amounts paid by Plaintiff. (Id. ¶ 17).
On September 25, 2009, Plaintiff filed a five-count Complaint against Defendants.
On March 22, 2010, Defendants filed a motion to disqualify Plaintiff‟s counsel. Plaintiff
is currently represented by Barnes & Thornburg (“B & T”). At least four years prior to
the filing of Plaintiff‟s suit, Hanley and HVS retained lawyers from Leagre Chandler &
2



Millard (“LCM”) to provide general corporate advice and counsel. (Declaration of David
B. Millard (“Millard Decl.”) ¶ 4). Shortly after Hanley and HVS retained LCM, many
lawyers previously associated with LCM joined B & T (the “LCM Attorneys”). (Millard
Decl. ¶ 5). Defendants claim that the prior representation was “substantially related to
Mr. Hanley‟s Home Video Studio Franchising Business.” (Defendants‟ Motion to
Disqualify ¶ 4).
II. Disqualification Standard
The Indiana Rules for Professional Conduct govern the conduct of those practicing
before this court. S.D. Ind. L. R. 83.5(g). Indiana Rule of Professional Conduct 1.9
states:
A lawyer who has formerly represented a client in a matter shall not thereafter represent
another person in the same or a substantially related matter in which that person‟s
interests are materially adverse to the interests of the former client unless the former
client gives informed consent, confirmed in writing.
Issues are “substantially related” if they involve the same transaction or dispute, or if
there is a substantial risk that confidential information given to a lawyer from a former
client could be used to materially advance the position of that lawyer‟s current client.
Comment 3 to Rule 1.9. However, “a lawyer who has recurrently handled a type of
problem for a former client is not precluded from later representing another client in a
factually distinct problem of that type even though the subsequent representation involves
a position adverse to the prior client.” Comment 2 to Rule 1.9.
3



When determining whether disqualification pursuant to Rule 1.9 is warranted, the
proper inquiry is “„whether it could reasonably be said that during the former
representation the attorney might have acquired information related to the subject matter
of the subsequent representation.‟” LaSalle Na‟l. Bank v. Lake County, 703 F.2d 252,
255 (7th Cir. 1983) (quoting Cannon v. U.S. Acoustics Corp., 398 F. Supp. 209, 223
(N.D. Ill. 1975)). To answer this question, the court uses the three-step “substantial
relationship” test. Emmis Operating Co. v. CBS Radio, Inc., 480 F. Supp. 2d 1111, 1118
(S.D. Ind. 2007). First, the court must “„make a factual reconstruction of the scope of the
prior legal representation.‟” Id. (quoting Schloetter v. Railoc of Ind., Inc., 546 F.2d 706,
710 (7th Cir. 1976)). Second, the court determines “„whether it is reasonable to infer that
the confidential information allegedly given would have been given to a lawyer
representing a client in those matters.‟” Id. (quoting Schloetter, 546 F.2d at 710). Third,
the court determines “„whether that information is relevant to the issues raised in the
litigation pending against the former client.‟” Id. (quoting Schloetter, 546 F.2d at 710).
Relevance is determined in light of the allegations in the complaint and the usefulness of
the information in establishing those allegations. Westinghouse Elec. Corp. v. Gulf Oil
Corp., 588 F.2d 221, 226 (7th Cir. 1978). If the court determines a substantial
relationship exists, then there is a rebuttable presumption that the attorney received
confidential information and should be disqualified. Emmis, 480 F. Supp. 2d at 1118
(citations omitted).
In cases where the Seventh Circuit has determined disqualification was warranted
4



because there was a “substantial relationship” between former and current representations
by an attorney, the relevance and relationship between the attorney‟s past representation
and current representation has usually been clear. Donohoe v. Consol. Operating & Prod.
Corp., 691 F. Supp. 109, 114 (N.D. Ill. 1988). Examples of substantial relationships
include “representations involving the same litigation, or involving work on a contract
and then litigation arising from that contract or involving work in obtaining a patent
followed by litigation challenging that patent.” Id. at 114-115 (internal citations omitted).
III. Discussion
The first step in the substantial relationship test is to make a “„factual
reconstruction of the scope of the prior legal representation.‟” Emmis, 480 F. Supp. 2d at
1118 (quoting Schloetter, 546 F.2d at 710). In the instant case, the allegations contained
in the Complaint all arise from the Franchise Agreement between Plaintiff, Hanley, and
HVF. Defendants claim that the work done for them by the LCM Attorneys was
“substantially related” to the franchising business, but they do not support this allegation
with any evidence. Plaintiff, however, submitted evidence demonstrating that HVF did
not even exist at the time the LCM Attorneys represented Hanley and HVS. (Millard
Decl. ¶¶ 4-10; see also Plaintiff‟s Opposition to Motion to Disqualify at Exhibit E). The
scope of the prior legal representation included matters relating to non-disclosure
agreements, vendor agreements, non-competition agreements, and trademark issues.
(Millard Decl. ¶ 10). The LCM Attorneys did recommend to Robert Hanley and HVS
that HVS should register as a franchise, but Hanley and HVS specifically declined any
5



opportunity to pursue that course of action with any LCM Attorneys. (Millard Decl. ¶
10f). Furthermore, evidence submitted by Plaintiff demonstrates that no LCM Attorney
performed any work relating to the franchising of HVS, the creation or operation of HVF,
or the creation of any part of the Franchise Agreement.
The second step of the substantial relationship test is difficult to apply in the
instant case because the Defendants do not allege any specific confidential information
that would have been given to a lawyer representing them. Regardless, it is clear from the
factual record that any confidential information previously given to any LCM Attorneys
would be irrelevant to the instant case. This action arises from the Franchise Agreement.
HVF did not exist at the time Defendants retained the LCM Attorneys, and Defendants
specifically refused to allow those lawyers to work on registering HVS as a franchise.
Therefore, Defendants‟ claim does not pass the substantial relationship test. As such,
Defendants‟ motion to disqualify must be denied.
IV. Conclusion
For the reasons set forth above, the court DENIES Defendants‟ Motion to
Disqualify (Docket # 24).
SO ORDERED this 12th day of August 2010.
RICHARD L. YOUNG, CHIEF JUDGE United States District Court Southern District of
Indiana
6
__________________________________
RICHARD L. YOUNG, CHIEF JUDGE United States District Court Southern District of
Indiana



Electronic Copies To:
Edward Timothy Delaney BARNES & THORNBURG LLP [email protected]
Bart A. Karwath BARNES & THORNBURG LLP [email protected]
Donald Robert Lundberg BARNES & THORNBURG LLP [email protected]
J. David Young LAW OFFICE OF J. DAVID YOUNG [email protected]



STATE OF CALIFORNIA
BUSINESS, TRANSPORTATION AND HOUSING AGENCY
DEPARTMENT OF CORPORATIONS
TO: Home Video Franchise Corporation dba Home Video Studio
Robert Hanley 8148 Raven Rock Drive Indianapolis, IN 46256
CITATION & DESIST AND REFRAIN ORDER
(For violation of section 31110 of the Corporations Code)
The California Corporations Commissioner (Commissioner) finds that:
1. Home Video Franchise Corporation dba Home Video Studio (“HVS”) is a New Jersey
corporation, incorporated on March 2, 2006. Its business address is 8148 Raven Rock Drive,
Indianapolis, Indiana, 46256.
2. Mr. Robert Hanley, a natural person and resident of Indiana, is the principal control
person of HVS. HVS offers and sells franchises allowing franchisees to operate and market a
home
business that provides video production, editing, duplication, DVD conversion, tape repair and
related services to the general public and local businesses.
3. HVS was registered to offer or sell franchises in California for three distinct periods:
(1) from October 3, 2006 to April 20, 2007; (2) April 25, 2007 to April 20, 2008; and, (3) March
30,
2008 to April 20, 2009.
4. The Commissioner is informed and believes that the franchisor, HVS and Hanley sold
six franchises in the State of California during the aforementioned registration periods.
-1-
DESIST AND REFRAIN ORDER



5. However, on April 19, 2010, HVS and Hanley sold a franchise to a California resident
outside of any relevant registration period.
Based upon the foregoing findings, the California Corporations Commissioner is of the
opinion that Mr. Robert Hanley and Home Video Franchising Corporation dba Home Video
Studio
offered and sold at least one franchise in California that was subject to registration under the
Franchise Investment Law without the offers and/or sales first being registered, in violation of
Corporations Code section 31110.
ORDER
1. Pursuant to section 31402 of the Corporations Code, Mr. Robert Hanley and Home
Video Franchising Corporation dba Home Video Studio are hereby ordered to desist and refrain
from
the further offer or sale of any and all franchises in the state of California, including but not
limited to
franchises in Home Video Studios, unless and until the offers of sale have been duly registered
under
the Franchise Investment Law, or are exempt.
ADMINISTRATIVE PENALTY
2. Pursuant to section 31406 of the Corporations Code, Mr. Robert Hanley and Home
Video Franchising Corporation dba Home Video Studio, are hereby jointly and severally
assessed
and ordered to pay an administrative penalty of two thousand five hundred dollars ($2,500)
within 30
days of the finality of this order. If within sixty (60) days from the receipt of this citation Mr.
Robert
Hanley and Home Video Franchising Corporation dba Home Video Studio fail to notify the
commissioner that they intend to request a hearing as described in subd. (d) of sec. 31406, the
citation
shall be deemed final. Subdivision (d) of 31406 provides that any hearing requested under sec.
31406 shall be conducted in accordance with Chapter 5 (commencing with section 11500) of
Part 1
of Division 3 of Title 2 of the California Govt. Code.
-2-
DESIST AND REFRAIN ORDER




ANCILLIARY RELIEF
3. Pursuant to section 31408 of the Corporations Code, Mr. Robert Hanley and Home
Video Franchising Corporation dba Home Video Studio are hereby ordered to deliver a Notice of
Violation (pursuant to California Corporations Code sec. 31303 and California Code of
Regulations,
Title 10, sec.s 310.303 and 310.304) to each and every California resident sold a franchise
outside a
relevant registration period. An Application for Approval as to form of the Notice of Violation
shall
be submitted to the Commissioner within 30 days of the finality of this Order and delivered to
the
franchisee(s) within 30 days after the Commissioner approves the Notice.
4. Additionally, pursuant to section 31408 of the Corporations Code, the Commissioner
hereby orders Robert Hanley to attend remedial education from the International Franchise
Association equal to at least 150 Educational Credits (whether on-line or in-person) within 12
months
of the finality of this order. Proof of completion of the remedial education must be presented to
the
Commissioner within that time.
5. At the appropriate time, the Commissioner, pursuant to section 31408 of the
Corporations Code, will seek to recover costs, which may include reasonable attorney‟s fees and
investigative costs, at the discretion of an administrative law judge.
This Order is necessary, in the public interest, for the protection of investors and franchisees
and consistent with the purposes, policies and provisions of the Franchise Investment Law.
Dated: May 18, 2012 JAN LYNN OWEN
Sacramento, CA California Corporations Commissioner
By:_______________________________
Alan S. Weinger Deputy Commissioner, Enforcement
-3-
DESIST AND REFRAIN ORDER


Scam Alert
How do you spot a franchise scam? February 3, 2002|
Back before California started the move to regulate the offering of
franchises during the 1960s, and long before the Federal Trade
Commission published its franchise rule at the end of the 1970s, buying a
franchise could be as risky as putting your 401(k) into Enron or Talk
magazine. Before disclosure, the franchise industry suffered from
companies that had lots of hype, little substance and an absence of
management talent. What they did have were great salespeople.
Some of the franchise offerings back in the '50s, '60s and '70s were for
companies that had never opened a single unit before selling franchises.
Some had management that had never been in the business but did have
experience in bankruptcies, litigation and problems with regulators. Some
of the companies were so weak financially that they needed the proceeds
from franchise sales to meet payroll or to pay for the franchise ads the
prospects responded to. There were even stories of franchisors whose
furniture was being repossessed in one room while the prospective
franchisee was in the other. Just because the government regulates
something, though, doesn't mean things are always better. While not
common, there are still franchise offerings today that are such poor
opportunities, they would have fit in nicely with the other bandits back then.
How is that possible? In part, due to the ease of developing a franchise
system, the lack of consistency in franchise regulations and to the way
franchises are sold. But the primary reason franchise scams still exist today
is there are still individuals who don't do their homework, and end up
investing in these "opportunities." They allow the bad opportunities to
remain in business.
There's no single indicator of a franchise scam, and you need to weigh all
the indicators in making your assessment. Just remember, hundreds of
superior franchise opportunities are available today, and there's absolutely


no reason to settle for less than the best opportunity in your investment
range. There's little you can do about the ease of development or the
inconsistency of regulations, but you can protect yourself by doing your
homework.
The disclosure document is a wonderful tool for prospective franchisees to
have. At your first personal meeting with a franchisor, that franchisor is
required to provide you with one. Some franchisors will even mail you a
disclosure document; others post them on their Web sites.
Even before you get to the point of contacting a franchisor, you can get a
sense of whether their opportunity is for real. Go online and research news
stories about the company and the industry. If the company is public, look
at the information available from their SEC filings. Visit their Web site and
get information about their consumer offering as well as their franchise
offering. Learn what you can about their management and thoroughly
research their background. Compare the company to its competition-both
franchised and non-franchised. Locate some of their stores and speak to
existing franchisees. Then, when you're satisfied, contact the company.
When you first contact the company, ask them about the process they use
in selecting franchisees. If you get the sense that they don't select
franchisees but are in the business of selling franchises, that's your first
indication the franchise is risky.
Remember, a franchise system is only as strong as its brand, and that
brand rests to a great extent on how well the other franchisees in the
system perform. If the franchisor lets anyone who has money in the system
and does not have selection criteria, then your investment will probably be
at risk.
If the company is willing to "sell" you a franchise and doesn't require you to
visit with them at their company headquarters so you can perform a
thorough evaluation of them and they can perform a thorough evaluation of
you, that's another sign of a poor franchise system. If the salesperson
you're talking with isn't an employee but an outside sales broker, that's
even a stronger indication. Remember, unless you buy the franchise, the
broker doesn't earn any money. And, since he isn't an employee of the
franchise system, he doesn't risk much more than the chance to earn a
future commission check if he recruits franchisees destined for failure.


When you visit the franchisor's headquarters, meet as many of the
franchise support people as you can. Assess whether they have the
experience to do their jobs. Make sure they're required to provide you with
the level of support you expect. Take a look at the condition of their offices.
Do you get the feeling of success or impending doom? Do all the
company's resources seem to go into marble and brass, or does the
company seem to be investing in computers, personnel, training programs
and other components of support?
Be prepared to thoroughly analyze your disclosure document. If you're still
interested after you read the company's information, engage a qualified
franchise attorney, consultant or accountant to help you in conducting your
due diligence. Franchise salespeople or brokers work for the franchisor. No
matter how friendly or professional they may be, you shouldn't rely solely
on their advice.
Scam Alert
The Red Flags February 3, 2002|
4
To determine whether a franchise is legitimate or a scam, answer the
following questions:
Does the company have experience in the business being offered? I'm not
talking about a related business, but the exact business. If the company
has successfully been operating 4,000-square-foot stores, but the franchise
opportunity is only for 1,000-square-foot stores, it's not the same business,
no matter what they say. The same works in reverse-bigger is not always
better. If you plan to open your franchises in Boston, but the only
experience the company has is in Texas, it's not necessarily the same
either. Have they done the necessary research to determine if the concept
will work in Boston, or are you going to be their cold weather guinea pig?


Does management have a history of success? Does the franchise
management know how to operate your business successfully? If not, what
type of support are you likely to get? How frequently have they changed
jobs? How well are their former companies doing? If they seem to move
just before the sheriff or process server arrives, that's not a good sign. If
they've worked with other franchisors, call franchisees of those systems
and find out how well this management did in the past. A mix of executives
with experience in the business and as successful franchisors is a great
benefit to franchisees.
What is the financial condition of the company? Your investment will
probably be significant. In some franchises, between debt and equity, your
investment may exceed seven figures. Will you have more skin in the game
than the franchisor does? Do they have a history of profitability? Are they
earning their revenue from royalties and other continuing sources of
revenue, or are they relying on the sale of the next franchise to make
payroll? Even new franchisors need to have financial resources to meet
their commitments.
Are you getting value for your money? Sure, if it's a well-known,
established brand and the franchisees in the system are doing well,
although this means you'll probably have to pay a sizeable franchise fee.
But, if it's a new franchise system and your training lasts only a few days,
are you paying more than it's worth? Paying $25,000 or more for a
franchise fee when you're only getting one week of training from a new
franchisor with limited experience, simply because they have a great
brochure, doesn't make sense. Ask the other franchisees in the system if
they got value for their money. Keep in mind, though, that franchisees new
to the system may not even know yet.
What's the franchisor's litigation or regulatory history? Franchisors must
disclose relevant litigation. Sometimes litigation is good. Any franchisor that
enforces system standards will occasionally need to sue its franchisees. If
they're able to still maintain a good relationship with their other franchisees,
that type of litigation is an indication of a strong and responsible franchisor.
However, if there are pages upon pages of lawsuits from franchisees listed
in the disclosure documents, that's not a good sign. You need to


understand the basis for the lawsuits and make a decision based upon the
facts. Your attorney can help you analyze the franchise litigation.
Is the franchise offered only in the non-registration states? Only 12 states
review franchise documents and require franchisors to register their
offering before getting permission to offer franchises in their state. In the
rest of the United States, no regulator ever sees the franchise offering.
Sometimes companies don't offer franchises in the registration states
simply because those states don't fit into their geographic strategy. But, if a
franchisor is offering franchises all over the United States except for the
registration states, that may indicate their franchise wouldn't meet the
requirements. Be very careful when you come upon opportunities that go
out of their way to avoid the registration states. For more information as
well as a complete list of franchise registration states, click here.
Finally, I have to admit some bias toward membership in the International
Franchise Association, since I'm on the IFA's Board of Directors; was
chairman of the professional arm of the association, the Supplier Forum,
and have been active in the organization for more than 15 years. While
active membership in the IFA doesn't guarantee a franchisor is a
worthwhile investment, it's a strong indicator of a responsible franchise
system. Active IFA members have access to training programs, networking
opportunities and meetings in which they can exchange best practices with
other franchisors.
These are just a few of the questions you need to assess in determining
whether the franchise you're interested in is a scam. Your outside advisors
can help you put aside your entrepreneurial eagnerness to get into the
game and assist you in conducting a proper due diligence. Don't get into a
franchise unless you have the assistance of a qualified expert. The
franchise salesperson who has befriended you has the advantage of
having been through the selling process hundreds of times. This is likely to
be your first experience.
Michael H. Seid is managing director of Michael H. Seid & Associates, a
West Hartford, Connecticut- and Troy, Michigan-based management
consulting firm specializing in the franchise industry. Seid recently co-
wroteFranchising for Dummies(IDG Books) with Wendy's founder, the late
Dave Thomas.


BBB BUSINESS REVIEW
THIS BUSINESS IS NOT BBB ACCREDITED
Home Video Studio, Inc. Fax: (317) 841-7756 View Additional Phone Numbers
BBB Accreditation
This business is not BBB accredited.
Businesses are under no obligation to seek BBB accreditation, and some businesses
are not accredited because they have not sought BBB accreditation.
To be accredited by BBB, a business must apply for accreditation and BBB must
determine that the business meets BBB accreditation standards, which include a
commitment to make a good faith effort to resolve any consumer complaints. BBB
Accredited Businesses must pay a fee for accreditation review/monitoring and for
support of BBB services to the public.
Reason for Rating
BBB rating is based on 16 factors. Get the details about the factors considered.
Factors that raised the rating for Home Video Studio, Inc. include:
Length of time business has been operating. No complaints filed with BBB. BBB has
sufficient background information on this business.


Cast
Credited cast:
Walter Baziak
... Lucas Stone
Ron Blackstone
... Sheriff
Steve Russell
... Hunter Tweed See full cast » Edit
Storyline
Add Full Plot | Add Synopsis
Taglines: Time Doesn't Heal Every Wound
Parents Guide: Add content advisory for parents » Edit Details
Country: USA Language: English Release Date: 1 May 1991 (Greece) See more
» Filming Locations: Indianapolis, Indiana, USA
Box Office


Budget: $150,000 (estimated) See more »
Company Credits
Production Co: New Era Pictures International See more » Show detailed
company contact information on IMDbPro »
Technical Specs
Runtime: 89 min Color: Color Aspect Ratio: 1.33 : 1 See full technical specs »
Scam Alert
How do you spot a franchise scam? February 3, 2002|
Back before California started the move to regulate the offering of
franchises during the 1960s, and long before the Federal Trade
Commission published its franchise rule at the end of the 1970s, buying a
franchise could be as risky as putting your 401(k) into Enron or Talk
magazine. Before disclosure, the franchise industry suffered from
companies that had lots of hype, little substance and an absence of
management talent. What they did have were great salespeople.
Some of the franchise offerings back in the '50s, '60s and '70s were for
companies that had never opened a single unit before selling franchises.
Some had management that had never been in the business but did have
experience in bankruptcies, litigation and problems with regulators. Some
of the companies were so weak financially that they needed the proceeds
from franchise sales to meet payroll or to pay for the franchise ads the
prospects responded to. There were even stories of franchisors whose
furniture was being repossessed in one room while the prospective
franchisee was in the other. Just because the government regulates
something, though, doesn't mean things are always better. While not
common, there are still franchise offerings today that are such poor
opportunities, they would have fit in nicely with the other bandits back then.
How is that possible? In part, due to the ease of developing a franchise
system, the lack of consistency in franchise regulations and to the way
franchises are sold. But the primary reason franchise scams still exist today
is there are still individuals who don't do their homework, and end up
investing in these "opportunities." They allow the bad opportunities to
remain in business.
There's no single indicator of a franchise scam, and you need to weigh all
the indicators in making your assessment. Just remember, hundreds of
superior franchise opportunities are available today, and there's absolutely


no reason to settle for less than the best opportunity in your investment
range. There's little you can do about the ease of development or the
inconsistency of regulations, but you can protect yourself by doing your
homework.
The disclosure document is a wonderful tool for prospective franchisees to
have. At your first personal meeting with a franchisor, that franchisor is
required to provide you with one. Some franchisors will even mail you a
disclosure document; others post them on their Web sites.
Even before you get to the point of contacting a franchisor, you can get a
sense of whether their opportunity is for real. Go online and research news
stories about the company and the industry. If the company is public, look
at the information available from their SEC filings. Visit their Web site and
get information about their consumer offering as well as their franchise
offering. Learn what you can about their management and thoroughly
research their background. Compare the company to its competition-both
franchised and non-franchised. Locate some of their stores and speak to
existing franchisees. Then, when you're satisfied, contact the company.
When you first contact the company, ask them about the process they use
in selecting franchisees. If you get the sense that they don't select
franchisees but are in the business of selling franchises, that's your first
indication the franchise is risky.
Remember, a franchise system is only as strong as its brand, and that
brand rests to a great extent on how well the other franchisees in the
system perform. If the franchisor lets anyone who has money in the system
and does not have selection criteria, then your investment will probably be
at risk.
If the company is willing to "sell" you a franchise and doesn't require you to
visit with them at their company headquarters so you can perform a
thorough evaluation of them and they can perform a thorough evaluation of
you, that's another sign of a poor franchise system. If the salesperson
you're talking with isn't an employee but an outside sales broker, that's
even a stronger indication. Remember, unless you buy the franchise, the
broker doesn't earn any money. And, since he isn't an employee of the
franchise system, he doesn't risk much more than the chance to earn a
future commission check if he recruits franchisees destined for failure.


When you visit the franchisor's headquarters, meet as many of the
franchise support people as you can. Assess whether they have the
experience to do their jobs. Make sure they're required to provide you with
the level of support you expect. Take a look at the condition of their offices.
Do you get the feeling of success or impending doom? Do all the
company's resources seem to go into marble and brass, or does the
company seem to be investing in computers, personnel, training programs
and other components of support?
Be prepared to thoroughly analyze your disclosure document. If you're still
interested after you read the company's information, engage a qualified
franchise attorney, consultant or accountant to help you in conducting your
due diligence. Franchise salespeople or brokers work for the franchisor. No
matter how friendly or professional they may be, you shouldn't rely solely
on their advice.
Scam Alert
The Red Flags February 3, 2002|
4
To determine whether a franchise is legitimate or a scam, answer the
following questions:
Does the company have experience in the business being offered? I'm not
talking about a related business, but the exact business. If the company
has successfully been operating 4,000-square-foot stores, but the franchise
opportunity is only for 1,000-square-foot stores, it's not the same business,
no matter what they say. The same works in reverse-bigger is not always
better. If you plan to open your franchises in Boston, but the only
experience the company has is in Texas, it's not necessarily the same
either. Have they done the necessary research to determine if the concept
will work in Boston, or are you going to be their cold weather guinea pig?


Does management have a history of success? Does the franchise
management know how to operate your business successfully? If not, what
type of support are you likely to get? How frequently have they changed
jobs? How well are their former companies doing? If they seem to move
just before the sheriff or process server arrives, that's not a good sign. If
they've worked with other franchisors, call franchisees of those systems
and find out how well this management did in the past. A mix of executives
with experience in the business and as successful franchisors is a great
benefit to franchisees.
What is the financial condition of the company? Your investment will
probably be significant. In some franchises, between debt and equity, your
investment may exceed seven figures. Will you have more skin in the game
than the franchisor does? Do they have a history of profitability? Are they
earning their revenue from royalties and other continuing sources of
revenue, or are they relying on the sale of the next franchise to make
payroll? Even new franchisors need to have financial resources to meet
their commitments.
Are you getting value for your money? Sure, if it's a well-known,
established brand and the franchisees in the system are doing well,
although this means you'll probably have to pay a sizeable franchise fee.
But, if it's a new franchise system and your training lasts only a few days,
are you paying more than it's worth? Paying $25,000 or more for a
franchise fee when you're only getting one week of training from a new
franchisor with limited experience, simply because they have a great
brochure, doesn't make sense. Ask the other franchisees in the system if
they got value for their money. Keep in mind, though, that franchisees new
to the system may not even know yet.
What's the franchisor's litigation or regulatory history? Franchisors must
disclose relevant litigation. Sometimes litigation is good. Any franchisor that
enforces system standards will occasionally need to sue its franchisees. If
they're able to still maintain a good relationship with their other franchisees,
that type of litigation is an indication of a strong and responsible franchisor.
However, if there are pages upon pages of lawsuits from franchisees listed
in the disclosure documents, that's not a good sign. You need to


understand the basis for the lawsuits and make a decision based upon the
facts. Your attorney can help you analyze the franchise litigation.
Is the franchise offered only in the non-registration states? Only 12 states
review franchise documents and require franchisors to register their
offering before getting permission to offer franchises in their state. In the
rest of the United States, no regulator ever sees the franchise offering.
Sometimes companies don't offer franchises in the registration states
simply because those states don't fit into their geographic strategy. But, if a
franchisor is offering franchises all over the United States except for the
registration states, that may indicate their franchise wouldn't meet the
requirements. Be very careful when you come upon opportunities that go
out of their way to avoid the registration states. For more information as
well as a complete list of franchise registration states, click here.
Finally, I have to admit some bias toward membership in the International
Franchise Association, since I'm on the IFA's Board of Directors; was
chairman of the professional arm of the association, the Supplier Forum,
and have been active in the organization for more than 15 years. While
active membership in the IFA doesn't guarantee a franchisor is a
worthwhile investment, it's a strong indicator of a responsible franchise
system. Active IFA members have access to training programs, networking
opportunities and meetings in which they can exchange best practices with
other franchisors.
These are just a few of the questions you need to assess in determining
whether the franchise you're interested in is a scam. Your outside advisors
can help you put aside your entrepreneurial eagnerness to get into the
game and assist you in conducting a proper due diligence. Don't get into a
franchise unless you have the assistance of a qualified expert. The
franchise salesperson who has befriended you has the advantage of
having been through the selling process hundreds of times. This is likely to
be your first experience.
Michael H. Seid is managing director of Michael H. Seid & Associates, a
West Hartford, Connecticut- and Troy, Michigan-based management
consulting firm specializing in the franchise industry. Seid recently co-
wroteFranchising for Dummies(IDG Books) with Wendy's founder, the late
Dave Thomas.


BBB BUSINESS REVIEW
THIS BUSINESS IS NOT BBB ACCREDITED
Home Video Studio, Inc. Fax: (317) 841-7756 View Additional Phone Numbers
BBB Accreditation
This business is not BBB accredited.
Businesses are under no obligation to seek BBB accreditation, and some businesses
are not accredited because they have not sought BBB accreditation.
To be accredited by BBB, a business must apply for accreditation and BBB must
determine that the business meets BBB accreditation standards, which include a
commitment to make a good faith effort to resolve any consumer complaints. BBB
Accredited Businesses must pay a fee for accreditation review/monitoring and for
support of BBB services to the public.
Reason for Rating
BBB rating is based on 16 factors. Get the details about the factors considered.
Factors that raised the rating for Home Video Studio, Inc. include:
Length of time business has been operating. No complaints filed with BBB. BBB has
sufficient background information on this business.


Cast
Credited cast:
Walter Baziak
... Lucas Stone
Ron Blackstone
... Sheriff
Steve Russell
... Hunter Tweed See full cast » Edit
Storyline
Add Full Plot | Add Synopsis
Taglines: Time Doesn't Heal Every Wound
Parents Guide: Add content advisory for parents » Edit Details
Country: USA Language: English Release Date: 1 May 1991 (Greece) See more
» Filming Locations: Indianapolis, Indiana, USA
Box Office


Budget: $150,000 (estimated) See more »
Company Credits
Production Co: New Era Pictures International See more » Show detailed
company contact information on IMDbPro »
Technical Specs
Runtime: 89 min Color: Color Aspect Ratio: 1.33 : 1 See full technical specs »