Regarding Bonchon franchises in California, what is the implication of Section 32.04 of the Franchise Agreement ('Venue') potentially not being enforceable under California law?

According to Bonchon's 2025 Franchise Disclosure Document, Section 32.04 of the Franchise Agreement stipulates that the venue for any legal disputes is limited to the laws of the State of New York. However, for franchises sold in California, this provision may not be enforceable under California law. This means that if a Bonchon franchisee in California were to enter into a legal dispute with Bonchon, the franchisee might be able to pursue the case in California courts, rather than being forced to litigate in New York.

This addendum to the franchise agreement is significant because it acknowledges the potential conflict between the standard Bonchon franchise agreement and California law. California has specific franchise laws in place to protect franchisees, and these laws often supersede the terms of the franchise agreement if there is a conflict. By stating that the venue provision may not be enforceable, Bonchon is effectively informing potential California franchisees that they may have the right to litigate disputes closer to home, which can reduce legal costs and make the process more convenient.

It is important for prospective Bonchon franchisees in California to understand this addendum and its implications. While the franchise agreement may initially seem to require disputes to be resolved in New York, California law may allow for the case to be heard in California. Franchisees should consult with an attorney to fully understand their rights and options in the event of a legal dispute with Bonchon. This ensures that franchisees are aware of the legal landscape and can make informed decisions regarding their franchise investment.