For legal proceedings not required to be submitted to arbitration, does the Better Blend franchise agreement specify that the parties consent to the jurisdiction of specific courts?
Better_Blend Franchise · 2024 FDDAnswer from 2024 FDD Document
- 2. Amendments. The Agreement (and any Guaranty Agreement) is amended to comply with the following:
- (3) Restrictions on Forum: Franchisee and any Guarantor are not required to consent to the jurisdiction of courts outside of North Dakota.
**MARYLAND RIDER TO FRANCHISE AGREEMENT [**if applicable: AND MULTI-UNIT DEVELOPMENT AGREEMENT]
- Jurisdiction. Franchisee does not waive its right to file a lawsuit alleging a cause of action arising under the Maryland Franchise Registration and Disclosure Law in any court of competent jurisdiction in the State of Maryland.
**RHODE ISLAND RIDER TO FRANCHISE AGREEMENT [**if applicable: AND MULTI-UNIT DEVELOPMENT AGREEMENT]
- Any provision of the Agreement restricting jurisdiction or venue Jurisdiction and Venue. to a forum outside the State of Rhode Island or requiring the application of the laws of another Investment Act. state is void with respect to a claim otherwise enforceable under Rhode Island Franchise
In addition, if litigation is not precluded by the franchise agreement, a franchisee may bring an action or proceeding arising out of or in connection with the sale of franchises, or a violation of the Washington Franchise Investment Protection Act, in Washington.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2024 FDD)
According to the 2024 Better Blend Franchise Disclosure Document, the standard franchise agreement may require franchisees to consent to the jurisdiction of specific courts, but this is subject to certain state-specific riders that modify this provision.
Specifically, the Ohio Rider to the Franchise Agreement does not address the issue of consent to jurisdiction of courts. However, the North Dakota Rider states that franchisees and any guarantors are not required to consent to the jurisdiction of courts outside of North Dakota. The Maryland Rider indicates that a franchisee does not waive its right to file a lawsuit alleging a cause of action arising under the Maryland Franchise Registration and Disclosure Law in any court of competent jurisdiction in the State of Maryland. The Rhode Island Rider states that any provision of the Agreement restricting jurisdiction or venue to a forum outside the State of Rhode Island or requiring the application of the laws of another state is void with respect to a claim otherwise enforceable under Rhode Island Franchise Investment Act. The Washington Addendum states that if litigation is not precluded by the franchise agreement, a franchisee may bring an action or proceeding arising out of or in connection with the sale of franchises, or a violation of the Washington Franchise Investment Protection Act, in Washington.
These riders modify the standard agreement to comply with state laws, ensuring that franchisees in North Dakota, Maryland, Rhode Island and Washington are not forced to litigate disputes in unfavorable locations or under unfavorable laws. This is a common practice in franchising, as state franchise laws often have specific protections for franchisees that override the standard terms of the franchise agreement.
Prospective Better Blend franchisees should carefully review the rider applicable to their state to understand their rights and obligations regarding dispute resolution and choice of law. Franchisees should consult with a legal professional to fully understand the implications of these provisions.