Are there any exceptions to the waiver of punitive damages between Bang Cookies and its franchisees?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
FRANCHISOR AND FRANCHISEE HEREBY WAIVE TO THE FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT TO OR CLAIM FOR ANY PUNITIVE, EXEMPLARY, CONSEQUENTIAL OR SPECULATIVE DAMAGES AGAINST THE OTHER AND AGREE THAT IN THE EVENT OF A DISPUTE BETWEEN THEM, EXCEPT AS OTHERWISE PROVIDED HEREIN, EACH SHALL BE LIMITED TO THE RECOVERY OF ACTUAL DAMAGES SUSTAINED BY IT, PROVIDED THAT SUCH WAIVER SHALL NOT APPLY TO ANY CLAIM (A) ALLOWED BY FRANCHISOR OR FRANCHISEE FOR ATTORNEY'S FEES OR COSTS AND EXPENSES UNDER THIS AGREEMENT; AND/OR (B) FOR LOST PROFITS BY FRANCHISOR OR FRANCHISEE AND THE OWNERS UPON OR ARISING OUT OF THE TERMINATION OF THIS AGREEMENT. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS AGREEMENT, IF ANY OTHER TERM OF THIS AGREEMENT IS FOUND OR DETERMINED TO BE UNCONSCIONABLE OR UNENFORCEABLE FOR ANY REASON, THE FOREGOING PROVISIONS OF WAIVER BY AGREEMENT OF PUNITIVE, EXEMPLARY, INCIDENTAL, INDIRECT, SPECIAL, CONSEQUENTIAL OR OTHER SIMILAR DAMAGES SHALL CONTINUE IN FULL FORCE AND EFFECT.
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, both the franchisor and franchisee waive their rights to claim punitive, exemplary, consequential, or speculative damages against each other in the event of a dispute. Instead, both parties are limited to recovering actual damages sustained.
However, there are exceptions to this waiver. The waiver does not apply to claims allowed by either Bang Cookies or the franchisee for attorney's fees, costs, and expenses under the Franchise Agreement. Additionally, the waiver does not apply to claims for lost profits by Bang Cookies or the franchisee and the owners resulting from the termination of the agreement.
Furthermore, the document states that if any other term of the agreement is found to be unconscionable or unenforceable, the waiver of punitive, exemplary, incidental, indirect, special, consequential, or other similar damages will remain in full effect. This ensures that the waiver remains valid even if other parts of the agreement are challenged.