Does the limitation on damages for 7 Brew extend to third parties?
7_Brew Franchise · 2025 FDDAnswer from 2025 FDD Document
- (c) LIMITATION ON DAMAGES: IN NO EVENT SHALL THE PARTIES BE LIABLE TO EACH OTHER, OR TO THEIR RESPECTIVE OFFICERS, EMPLOYEES OR REPRESENTATIVES, OR TO ANY THIRD PARTY, FOR ANY INDIRECT, CONSEQUENTIAL, INCIDENTAL, SPECIAL, PUNITIVE OR EXEMPLARY DAMAGES OF OWNER, OWNER'S OFFICERS, EMPLOYEES, REPRESENTATIVES OR INSUREERS, OR OF ANY THIRD PARTY, OF WHATSOEVER NATURE (INCLUDING, BUT NOT LIMITED TO, LOST BUSINESS, LOST PROFITS, DAMAGE TO GOODWILL OR REPUTATION AND/OR DEGRADATION IN VALUE OF BRANDS, TRADEMARKS, TRADENAMES, SERVICES NAMES OR SERVICE MARKS, OR INJURY TO PERSONS) WHETHER ARISING OUT OF BREACH OF CONTRACT, WARRANTY, TORT (INCLUDING NEGLIGENCE, FAILURE TO WARN OR STRICT LIABILITY), CONTRIBUTION, INDEMNITY, SUBROGATION OR OTHERWISE.
Source: Item 23 — RECEIPTS (FDD pages 83–279)
What This Means (2025 FDD)
According to 7 Brew's 2025 Franchise Disclosure Document, the limitation on damages extends to third parties. Specifically, the document states that in no event shall the parties be liable to each other, their officers, employees, or representatives, or to any third party for any indirect, consequential, incidental, special, punitive, or exemplary damages.
This limitation includes damages of any nature, such as lost business, lost profits, damage to goodwill or reputation, degradation in the value of brands, trademarks, tradenames, service names or service marks, or injury to persons. This applies whether the damages arise out of breach of contract, warranty, tort (including negligence, failure to warn, or strict liability), contribution, indemnity, subrogation, or otherwise.
For a prospective 7 Brew franchisee, this means that the franchisor aims to limit its liability for various types of damages, not only to the franchisee but also to third parties. This could impact the franchisee's ability to recover certain types of losses from 7 Brew, and it also limits the potential for third parties to sue 7 Brew and recover damages for specific issues related to the franchise operation. Franchisees should carefully consider the implications of this limitation, especially in relation to potential risks and liabilities associated with operating a 7 Brew franchise.