What is the presumption regarding the reasonableness and enforceability of non-compete covenants longer than 18 months for Bang Cookies franchisees in Washington?
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.
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- In the event of a conflict of laws, the provisions of the Washington Franchise Investment Protection Act, Chapter 19.100 RCW shall prevail.
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- 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's 2024 Franchise Disclosure Document, Washington state law impacts the enforceability of non-compete agreements. Specifically, Washington law creates a presumption that any non-compete covenant lasting longer than 18 months is considered unreasonable and unenforceable. This presumption is outlined in the Washington State Franchise Agreement Amendment within the FDD.
For a prospective Bang Cookies franchisee in Washington, this means that if the franchise agreement contains a non-compete clause extending beyond 18 months, it is likely to be viewed unfavorably by Washington courts. The franchisee could argue that such a clause is unenforceable based on this presumption. This does not automatically invalidate the clause, but it shifts the burden to Bang Cookies to prove that the longer duration is indeed reasonable.
This provision offers some protection to franchisees, as it limits the scope of non-compete obligations that Bang Cookies can impose. It is important for potential franchisees to consult with legal counsel to fully understand the implications of non-compete clauses in their franchise agreement and how Washington law applies. This also means that Bang Cookies cannot prevent a franchisee from soliciting or hiring any employee of the franchisor or a franchisee of the same franchisor.