In Illinois, is a Body20 franchise agreement provision that requires a franchisee to waive compliance with the Illinois Franchise Disclosure Act valid?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
The following is added at the end of Item 17:
Any condition, stipulation or provision purporting to bind any person acquiring any franchise to waive compliance with the Illinois Franchise Disclosure Act or any other law of Illinois is void.
The Illinois Franchise Disclosure Act provides that any provision in a franchise agreement that designates jurisdiction or venue in a forum outside of Illinois is void with respect to any action that is otherwise enforceable in Illinois. However, a franchise agreement may provide for arbitration to take place outside of Illinois.
Except to the extent governed by the Federal Arbitration Act or other federal law, Illinois law governs the Franchise Agreement and Development Agreement.
The conditions under which your Franchise Agreement or Development Agreement can be terminated and your rights upon nonrenewal (as applicable) may be affected by Sections 19 and 20 of the Illinois Franchise Disclosure Act.
Source: Item 23 — RECEIPT (FDD pages 74–251)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, any provision in a franchise agreement that requires a franchisee to waive compliance with the Illinois Franchise Disclosure Act is void in Illinois. This protection is explicitly stated in the FDD to ensure franchisees are not forced to relinquish their rights under Illinois law. This applies to both the standard Franchise Agreement and the Development Agreement used for multi-unit development.
Specifically, the FDD includes a rider for Illinois franchisees that reinforces this protection. This rider is annexed to and forms part of the Development Agreement if any offering or sales activity relating to the Development Agreement occurred in Illinois, the studios will be located in Illinois, or the franchisee is domiciled in Illinois. The rider explicitly states that any provision purporting to waive compliance with the Illinois Franchise Disclosure Act or any other law of Illinois is void, although it does allow for settlement agreements or general releases regarding potential lawsuits and the arbitration of claims under Title 9 of the United States Code.
Furthermore, the FDD clarifies that while Illinois law governs the Franchise Agreement and Development Agreement (except to the extent governed by the Federal Arbitration Act or other federal law), any provision designating jurisdiction or venue outside of Illinois is void. However, the agreement may still provide for arbitration to take place outside of Illinois. This ensures that Illinois franchisees have the ability to pursue legal action within their own state, if applicable, while still allowing for arbitration as a dispute resolution method.
In summary, Body20 franchisees in Illinois are protected by state law, which prevents them from being forced to waive their rights under the Illinois Franchise Disclosure Act. This protection is embedded in both the Franchise Agreement and the Development Agreement through specific riders and disclosures, ensuring that franchisees are aware of their rights and that any conflicting provisions are unenforceable.