Can Bombs Away require a franchisee to consent to liquidated damages under Minnesota law?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
- **2.
Amendments.** The Agreement is amended to comply with the following:
- Minnesota Statutes, Section 80C.21 and Minnesota Rules 2860.4400(J) prohibit the franchisor from requiring litigation to be conducted outside Minnesota, requiring waiver of a jury trial, or requiring the franchisee to consent to liquidated damages, termination penalties or judgment notes.
Source: Item 22 — CONTRACTS (FDD pages 35–36)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, if a franchisee is operating in Minnesota, Bombs Away cannot require the franchisee to consent to liquidated damages. This is explicitly stated in the Minnesota Rider to the Franchise Agreement.
This protection is in place because Minnesota Statutes, Section 80C.21 and Minnesota Rules 2860.4400(J) explicitly prohibit Bombs Away from requiring franchisees to consent to liquidated damages, termination penalties, or judgment notes within the state. This means that any clause in the standard franchise agreement that might imply consent to such penalties is unenforceable in Minnesota.
This provision ensures that Minnesota franchisees retain all rights and remedies available under Minnesota law, preventing Bombs Away from imposing unfair financial burdens through mandatory consent to liquidated damages. Prospective franchisees in Minnesota should be aware of this protection, as it can significantly impact their financial exposure in the event of a dispute or termination.