Does the Aira Fitness franchise agreement allow a Developer to claim consequential, punitive, or exemplary damages against the Franchisor?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
If we obtain an injunction or order of specific performance, you agree to pay us an amount equal to the total of our costs of obtaining it, including, without limitation, reasonable attorneys' fees, expert witness fees, costs of investigation and proof of facts, court costs, other litigation expenses and travel and living expenses, and any damages we incur as a result of the breach of any such provision. You further agree to waive any claims for damages in the event there is a later determination that an injunction or specific performance order was issued improperly.
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
Based on the 2025 Aira Fitness Franchise Disclosure Document, the franchise agreement includes a clause addressing the waiver of damage claims under specific circumstances. If Aira Fitness obtains an injunction or order of specific performance against the developer, the developer agrees to pay Aira Fitness's costs, including attorney's fees, expert witness fees, investigation costs, court costs, and travel expenses. More importantly, the developer also agrees to waive any claims for damages if it is later determined that the injunction or specific performance order was issued improperly.
This waiver means that if a court initially grants an injunction in favor of Aira Fitness but later reverses that decision, the developer cannot sue Aira Fitness for damages incurred as a result of the wrongly issued injunction. This could include financial losses, reputational damage, or other harm suffered during the period the injunction was in place. The franchisee bears the risk of the injunction being wrongly issued.
This type of clause is not uncommon in franchise agreements, as it aims to protect the franchisor from potential lawsuits arising from actions taken to enforce the agreement. However, it places a significant burden on the franchisee, who may have limited recourse even if the franchisor's actions are later deemed incorrect or unjustified. Prospective Aira Fitness franchisees should carefully consider this provision and seek legal counsel to understand its implications fully.