What are the requirements for a negotiated settlement where a Best Brains franchisee waives exemplary or punitive damages to be valid?
Best_Brains Franchise · 2025 FDDAnswer from 2025 FDD Document
RCW 19.100.190 permits franchisees to seek treble damages under certain circumstances.
Accordingly, provisions contained in the franchise agreement or elsewhere requiring franchisees to waive exemplary, punitive, or similar damages are void, except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel, in accordance with RCW 19.100.220(2).
Source: Item 23 — RECEIPTS (FDD pages 42–190)
What This Means (2025 FDD)
According to the 2025 Best Brains Franchise Disclosure Document, a franchisee can only waive their right to exemplary, punitive, or similar damages if specific conditions are met. These conditions are designed to ensure the franchisee's waiver is informed and voluntary.
Specifically, the waiver must be executed as part of a negotiated settlement that occurs after the franchise agreement is already in effect. This means the agreement to waive such damages cannot be a condition of entering into the franchise agreement itself. Furthermore, both Best Brains and the franchisee must be represented by independent legal counsel during these negotiations. This requirement ensures that the franchisee has professional advice and is not pressured into relinquishing important rights.
These stipulations are in accordance with RCW 19.100.220(2), a Washington state law. This law aims to protect franchisees from unknowingly or unfairly giving up their legal rights. Prospective Best Brains franchisees should understand these conditions to ensure any waiver of damages is legally sound and protects their interests.