For Alloy franchises in Maryland, can any provision in the Agreement require a franchisee to disclaim acts that would violate the Maryland Franchise Registration and Disclosure Law?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Any provision in the Agreement that requires you to disclaim the occurrence and/or acknowledge the non-occurrence of acts that would constitute a violation of the Maryland Franchise Registration and Disclosure Law is not intended to nor will it act as a release, estoppel or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law.
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- No disclaimer, questionnaire, clause, or statement signed by a franchisee in connection with the commencement of the franchise relationship shall be construed or interpreted as waiving any claim of fraud in the inducement, whether common law or statutory, or as disclaiming reliance on or the right to rely upon any statement made or information provided by any franchisor, broker or other person acting on behalf of the franchisor that was a material inducement to a franchisee's investment. This provision supersedes any other or inconsistent term of any document executed in connection with the franchise.
Source: Item 23 — RECEIPTS (FDD pages 69–245)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, provisions within the franchise agreement cannot require a franchisee to disclaim actions that would violate Maryland's Franchise Registration and Disclosure Law. Specifically, any attempt to disclaim the occurrence or acknowledge the non-occurrence of acts that would violate this law will not act as a release, estoppel, or waiver of liability. This protection is explicitly outlined in an addendum to the franchise agreement required for Maryland franchisees.
This provision ensures that Alloy franchisees in Maryland retain their rights and protections under Maryland franchise law. It prevents Alloy from using contractual language to circumvent the legal safeguards in place for franchisees. This means that franchisees cannot be forced to waive their right to pursue claims related to violations of the Maryland Franchise Registration and Disclosure Law.
Furthermore, the addendum clarifies that no disclaimer, questionnaire, clause, or statement signed by a franchisee can be interpreted as waiving claims of fraud in the inducement or disclaiming reliance on statements made by Alloy or its representatives. This protection supersedes any other conflicting terms in any document related to the franchise agreement, reinforcing the franchisee's ability to rely on information provided during the franchise sales process. This is a crucial protection for franchisees, as it ensures they are not bound by disclaimers that could prevent them from seeking legal recourse if they were misled during the initial stages of the franchise relationship.