What specific section of the Bft Multi-Unit Agreement regarding Governing Law is deleted and replaced?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
- Governing Law. Section 12.A (Governing Law) of the Multi-Unit Agreement is deleted in its entirety and replaced with the following language:
Except to the extent governed by the Federal Arbitration Act, the United States Trademark Act of 1946 (Lanham Act, 15 U.S.C. Sections 1051 etseq.), or other federal law, and except as otherwise required by North Dakota law, this Agreement, the franchise, and all claims arising from the relationship between Franchisor and Developer will be governed by the laws of the State of California, without regard to its conflict of laws rules, except that any state law regulating the sale of franchises or governing the relationship of a franchisor and its franchisee will not apply unless its jurisdictional requirements are met independently without reference to this section.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–66)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, Section 12.A (Governing Law) of the Multi-Unit Agreement is deleted in its entirety and replaced with specific language for franchisees in North Dakota. The replacement specifies that, except to the extent governed by the Federal Arbitration Act, the United States Trademark Act of 1946 (Lanham Act, 15 U.S.C. Sections 1051 etseq.), or other federal law, and except as otherwise required by North Dakota law, the agreement, the franchise, and all claims arising from the relationship between Bft and the Developer will be governed by the laws of the State of California, without regard to its conflict of laws rules. However, any state law regulating the sale of franchises or governing the relationship of a franchisor and its franchisee will not apply unless its jurisdictional requirements are met independently without reference to this section.
This means that for Bft franchisees in North Dakota, while California law generally governs the agreement, North Dakota law will take precedence in certain situations. These situations include those governed by the Federal Arbitration Act, the Lanham Act, or other federal laws, and where North Dakota law specifically requires it. This ensures that franchisees retain protections and rights afforded to them under North Dakota franchise law.
It is important for prospective Bft franchisees in North Dakota to understand this modification, as it clarifies which state's laws will govern their agreement and relationship with the franchisor. This ensures that franchisees are aware of their rights and obligations under both California and North Dakota law. Franchisees should consult with a legal professional to fully understand the implications of these governing law provisions.