Does 1 800 Packouts' Franchise Agreement still include a waiver of a jury trial?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
- a. All provisions of this Franchise Agreement (including the language of this Article) will be fully enforced, including those relating to arbitration, waiver of jury trial, limitation of damages, venue, choice of laws, and shortened periods in which to bring claims.
- b. All of the terms, covenants, and conditions of this Article, including the choice of law, choice of venue, and use of arbitration are mandatory and not permissive.
- c. The Parties rely on the federal preemption of state laws under the Federal Arbitration Act (9 U.S.C. §1 et seq.) (FAA) with the understanding that the FAA and not state law will control any matters concerning mediation and arbitration and, as a result, the provisions of this Franchise Agreement will be enforced only according to its terms and through the alternative dispute mechanism found in this Article. The Parties further agree that each Party intends that any state law attempting to prohibit arbitration or attempting to void out-of-state forums for arbitration are preempted by the Federal Arbitration Act and that arbitration will be held as provided in this Article.
d. Except as expressly provided in this Franchise Agreement, **EACH PARTY KNOWINGLY WAIVES ALL RIGHTS TO A COURT OR JURY TRIAL AND, INSTEAD, SELECTS FACE-TO-FACE MEETINGS, MEDIATION AND FINALLY BINDING ARBITRATION AS THE SO
Source: Item 23 — RECEIPT (FDD pages 67–238)
What This Means (2025 FDD)
According to the 2025 1 800 Packouts Franchise Disclosure Document, the franchise agreement includes a waiver of jury trial. Specifically, each party knowingly waives all rights to a court or jury trial, opting instead for face-to-face meetings, mediation, and binding arbitration as methods of dispute resolution. This waiver is emphasized as mandatory and not permissive.
However, this waiver is not absolute and is subject to certain state laws. For instance, the North Dakota Securities Commissioner has determined that requiring a franchisee to waive a jury trial is unfair and may not be enforceable under North Dakota Franchise Investment Law. Similarly, Minnesota law might prohibit 1 800 Packouts from enforcing a jury trial waiver, and the franchise agreement will be enforced to the extent the law allows. The Illinois Franchise Disclosure Act also limits the enforceability of jury trial waivers.
These stipulations mean that while 1 800 Packouts' standard franchise agreement includes a jury trial waiver, its enforceability can vary significantly depending on the franchisee's location and the relevant state laws. Prospective franchisees should be aware of the dispute resolution methods outlined in the agreement and understand how local laws might affect their rights. It is advisable to consult with a legal professional to fully understand the implications of these waivers in their specific state.