What is the presumed unreasonable duration for a non-compete covenant in Washington related to a Bang Cookies franchise?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
her in the State of Washington, or in a place mutually agreed upon at the time of the arbitration or as determined by the arbitrator.
-
- In the event of a conflict of laws, the provisions of the Washington Franchise Investment Protection Act, Chapter 19.100 RCW shall prevail.
-
- A release or waiver of rights executed by a franchisee shall not include rights under the Washington Franchise Investment Protection Act except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel. Provisions such as those which unreasonably restrict or limit the statute of limitations period for claims under the Act, rig
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies' 2024 Franchise Disclosure Document, Washington state law impacts the enforcement of non-compete agreements for franchisees. Specifically, Washington law creates a presumption that any non-compete covenant lasting longer than 18 months is considered unreasonable and therefore unenforceable. This provision is part of the Washington State Franchise Investment Protection Act.
For a prospective Bang Cookies franchisee in Washington, this means that while a non-compete agreement might exist within the franchise agreement, its enforceability is limited. If the non-compete period exceeds 18 months, the franchisee can argue that it is unreasonable under Washington law. This provides some protection to the franchisee, allowing them to potentially compete with Bang Cookies after a shorter period than might otherwise be stipulated in the franchise agreement.
It's important to note that this provision does not automatically invalidate all non-compete agreements. Instead, it establishes a legal presumption that shifts the burden of proof to Bang Cookies to demonstrate why a longer non-compete period is reasonable in a specific case. Franchisees should consult with legal counsel to fully understand their rights and obligations under Washington law regarding non-compete agreements.