Under Minnesota law, can Bombs Away require a franchisee to consent to termination penalties?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
In the State of Minnesota only, this Disclosure Document is amended as follows:
- 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. In addition, nothing in the Franchise Disclosure Document or agreement(s) can abrogate or reduce (1) any of the franchisee's rights as provided for in Minnesota Statutes, Chapter 80C or (2) franchisee's rights to any procedure, forum, or remedies provided for by the laws of the jurisdiction.
- With respect to franchises governed by Minnesota law, the franchisor will comply with Minnesota Statutes, Section 80C.14, Subd. 3-5, which require (except in certain specified cases) (1) that a franchisee be given 90 days' notice of termination (with 60 days to cure) and 180 days' notice for non-renewal of the franchise agreement and (2) that consent to the transfer of the franchise will not be unreasonably withheld.
Source: Item 23 — RECEIPTS (FDD pages 36–117)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, Minnesota law has specific protections for franchisees. In Minnesota, Bombs Away is prohibited from requiring franchisees to consent to termination penalties. This protection is explicitly stated in the Minnesota Addendum to the Disclosure Document.
Minnesota Statutes, Section 80C.21 and Minnesota Rules 2860.4400(J) also prevent Bombs Away from requiring franchisees to conduct litigation outside of Minnesota or waive their right to a jury trial. Furthermore, the franchise agreement cannot reduce any rights provided to the franchisee under Minnesota Statutes, Chapter 80C, or their rights to procedures, forums, or remedies available under Minnesota law.
Bombs Away must also comply with Minnesota Statutes, Section 80C.14, Subd. 3-5, regarding termination and non-renewal. This statute requires Bombs Away to provide a franchisee with 90 days' notice of termination (with 60 days to cure) and 180 days' notice for non-renewal, except in certain specified cases. Additionally, Bombs Away cannot unreasonably withhold consent for the transfer of a franchise.