Is Speedline liable for punitive damages related to the software used by Beggars Pizza?
Beggars_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
IN NO EVENT SHALL SPEEDLINE OR ITS SUPPLIERS BE LIABLE FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL, OR INCIDENTAL DAMAGES OF ANY KIND; DAMAGES TO THE CUSTOMER'S COMPUTER, OTHER SOFTWARE, SYSTEMS, DATA, OR OTHER FACILITIES; DAMAGES FOR LOSS OF BUSINESS PROFITS, BUSINESS INTERRUPTIONS, LOSS OF BUSINESS INFORMATION, OR ANY OTHER ECONOMIC LOSS OR PECUNIARY LOSS; PUNITIVE DAMAGES; OR COSTS OF DATA STORAGE OR COMMUNICATIONS LINKS (INCLUDING ANY BACK-UP STORAGE OR LINKS) ARISING OUT OF OR IN CONNECTION WITH THE USE OF OR INABILITY TO USE THE SOFTWARE OR ANY UPDATES, EVEN IF SPEEDLINE OR THE SUPPLIERS HAVE BEEN ADVISED OF THE POSSIBILITIES OF SUCH DAMAGES OR LOSSES.
IN ANY CASE THE AGGREGATE AMOUNT OF SPEEDLINE'S AND THE SUPPLIERS' ENTIRE LIABILITY IN CONTRACT, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE UNDER ANY AND ALL PROVISIONS OF THIS AGREEMENT SHALL NOT EXCEED THE AMOUNT OF ALL PAYMENTS MADE BY THE CUSTOMER TO SPEEDLINE UNDER THIS AGREEMENT.
THIS EXCLUSION OF LIABILITY ALSO INCLUDES ANY LIABILITY WHICH MAY ARISE OUT OF THIRD PARTY CLAIMS AGAINST THE CUSTOMER. THE PURPOSE OF THIS PROVISION IS TO LIMIT THE POTENTIAL LIABILITY OF SPEEDLINE AND THE SUPPLIERS ARISING OUT OF THIS AGREEMENT.
Source: Item 23 — RECEIPT (FDD pages 39–192)
What This Means (2025 FDD)
According to Beggars Pizza's 2025 Franchise Disclosure Document, Speedline, the software provider, has limited liability regarding damages related to the software. Specifically, Speedline is not liable for punitive damages arising from the use or inability to use their software. This limitation extends even if Speedline or its suppliers were aware of the potential for such damages or losses.
This means that if a Beggars Pizza franchisee experiences issues with the Speedline software that lead to a situation where punitive damages are sought, Speedline is contractually protected from being held liable for those damages. The agreement aims to limit Speedline's potential liability, and this exclusion applies to claims made against the franchisee by third parties as well.
This limitation of liability is a significant point for prospective Beggars Pizza franchisees to consider. While Speedline provides the software, the financial risk associated with potential software-related issues, leading to punitive damages, largely falls on the franchisee. Beggars Pizza franchisees should carefully assess their insurance coverage and legal protections in light of this clause. It is also important to note that Speedline's aggregate liability is capped at the amount of payments the customer made to Speedline under the agreement.
It is common practice for software providers to limit their liability in licensing agreements. However, franchisees should understand the specific limitations and ensure they have adequate protection against potential losses. Beggars Pizza franchisees should consult with legal and insurance professionals to fully understand the implications of this clause and to determine appropriate risk management strategies.