Each question is hypothetical and needs to be in the IRAC method. There is no other data or graphic link and is not an "incomplete question"

1.US Meals, Inc., owns and sells franchises, selling chicken baskets, known as Los Pollos Hermanos (LPH)! Under the agreement, franchisees must hire and train employees strictly according to LPH's rules. LPH's regional supervisors are required to approve all job candidates before they are hired and all general policies affecting those employees. LPH reserves the right to terminate a franchise for violating the franchisor's rules. In practice, however, LPH's regional supervisors routinely approve new employees and individual franchisees' policies. After several incidents of racist comments and conduct by Tim, a recently hired assistant manager at a LPH, Sharon, a counterperson at the restaurant, resigns. Sharon files a suit in court against US Meals, Inc. US Meals, Inc. argues that it is not liable for harassment by its franchisee's employees.

A. Is there an agency (employer-employee) or an independent contractor relationship between US Meals, Inc. and the LPH as a franchisee? Explain. [Hint: level of control and extent of liabilities in agency relationships]

B. Based on your answer to A, what is the most likely result of the lawsuit between US Meals, Inc. and Sharon?

[Hint: agency and liability of principal to third parties in tort]