Under what circumstances does the waiver of punitive damages NOT apply to Apricot Lane franchisees?
Apricot_Lane Franchise · 2025 FDDAnswer from 2025 FDD Document
EXCEPT FOR THE INDEMNIFICATION OBLIGATIONS UNDER SECTION 21.C AND CLAIMS BASED ON UNAUTHORIZED USE OF THE MARKS OR UNAUTHORIZED USE OR DISCLOSURE OF ANY CONFIDENTIAL INFORMATION, FRANCHISOR AND FRANCHISEE (AND ITS OWNERS) WAIVE TO THE FULLEST EXTENT PERMITTED BY LAW ANY RIGHT TO OR CLAIM FOR ANY PUNITIVE, EXEMPLARY, AND TREBLE AND OTHER FORMS OF MULTIPLE DAMAGES AGAINST THE OTHER AND AGREE THAT, IN THE EVENT OF A DISPUTE BETWEEN FRANCHISOR AND FRANCHISEE (AND/OR ITS OWNERS), THE PARTY MAKING A CLAIM WILL BE LIMITED TO EQUITABLE RELIEF AND TO RECOVERY OF ANY ACTUAL DAMAGES IT SUSTAINS.
Source: Item 23 — RECEIPTS (FDD pages 51–222)
What This Means (2025 FDD)
According to Apricot Lane's 2025 Franchise Disclosure Document, both the franchisor and franchisee waive their rights to claim punitive damages against each other in the event of a dispute. However, this waiver does not apply under specific circumstances.
The waiver of punitive damages does not apply to Apricot Lane franchisees regarding indemnification obligations as detailed under Section 21.C of the franchise agreement. Additionally, the waiver is not applicable to claims based on unauthorized use of the Apricot Lane marks or unauthorized use or disclosure of any confidential information.
This means that if an Apricot Lane franchisee is found liable for unauthorized use of the brand's trademarks or divulging confidential information, Apricot Lane can seek punitive damages. Similarly, the franchisee retains the right to pursue punitive damages from Apricot Lane if the dispute falls under the indemnification obligations outlined in Section 21.C. Prospective franchisees should carefully review Section 21.C to understand the scope of these indemnification obligations and the circumstances under which they might be liable for or able to claim punitive damages.