What sections of the Brain Balance Franchise Agreement and Disclosure Document are amended regarding applicable law?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
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- The provisions of Item 17(w) and of the Disclosure Document and Section 21.01 of the Franchise Agreement with regard to the applicable law are hereby deleted and amended by the addition of the following language:
- The Franchise Agreement will be construed and enforced under the laws of North Dakota without regard to the rules of conflict of laws.
- Item 17 and the standard Franchise Agreement and Satellite Franchise Agreement are hereby amended by the addition of the following language:
A Maryland franchise regulation states that it is an unfair or deceptive practice to require a franchisee to waive its right to the lawsuit in Maryland claiming a violation of the Maryland Franchise Law. In light of the Federal Arbitration Act, there is some dispute as to whether this forum selection requirement is legally enforceable.
- Item 17, Caption v, and Section 21.01 of the standard Franchise Agreement and Satellite Franchise Agreement, to the extent contrary to Maryland Franchise Registration and Disclosure Law, is hereby deleted and amended by the addition of the following language:
A franchisee to bring a lawsuit in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law.
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- The provisions of Item 17(w) and of the Disclosure Document and Section 21.01 of the Franchise Agreement with regard to the applicable law are hereby deleted and amended by the addition of the following language:
The California choice of law should not be considered a waiver of any right conferred upon us or you by Article 33 of the General Business Law of the State of New York.
Source: Item 23 — RECEIPTS (FDD pages 72–292)
What This Means (2025 FDD)
According to the 2025 Brain Balance Franchise Disclosure Document, several addenda address amendments to the Franchise Agreement and Disclosure Document concerning applicable law, depending on the state where the franchise is located. For franchisees in North Dakota, Item 17(w) of the Disclosure Document and Section 21.01 of the Franchise Agreement are amended to specify that the agreement will be construed and enforced under the laws of North Dakota, disregarding conflict of laws rules. This ensures that North Dakota law governs the franchise relationship for franchisees in that state.
For franchisees in Maryland, Item 17 and the standard Franchise Agreement and Satellite Franchise Agreement are amended to include a statement that it is an unfair or deceptive practice to require a franchisee to waive their right to sue in Maryland for violations of Maryland Franchise Law. Additionally, Item 17, Caption v, and Section 21.01 of the standard Franchise Agreement and Satellite Franchise Agreement are amended to allow a franchisee to bring a lawsuit in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law. These amendments protect the franchisee's right to legal recourse under Maryland law.
For franchisees in New York, the provisions of Item 17(w) and Section 21.01 of the Franchise Agreement regarding applicable law are amended to ensure that the California choice of law does not waive any rights conferred by Article 33 of the General Business Law of the State of New York. This amendment ensures that New York franchisees retain their rights under New York law, regardless of the California choice of law provision. These state-specific addenda reflect Brain Balance's effort to comply with local franchise laws and protect franchisees' rights within those jurisdictions.