Is the U.S. Trademark Act of 1946 an exception to the governing law of the Buildingstars Franchise Agreement?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
FRANCHISEE acknowledges that this Agreement was accepted in the State of Missouri.
Except to the extent that this Agreement or any particular dispute is governed by the U.S.
Trademark Act of 1946 (Lanham Act, 115 U.S.C. 1051), this Agreement will be governed, to the extent permissible, by the laws of the State of Missouri (without reference to its conflict of laws principles).
If, however, any provision of this Agreement would not be enforceable under the laws of Missouri, and if the Business is located outside of Missouri and the provision would be enforceable under the laws of the state in which the Business is located, then the provision in question (and only that provision) will be interpreted and construed under the laws of the state where the Business is located.
Source: Item 23 — RECEIPT (FDD pages 43–217)
What This Means (2025 FDD)
According to Buildingstars's 2025 Franchise Disclosure Document, the U.S. Trademark Act of 1946 is an exception to the governing law of the Buildingstars Franchise Agreement. Except when the U.S. Trademark Act of 1946 (Lanham Act, 115 U.S.C. 1051) governs a particular dispute, the agreement is controlled by the laws of Missouri, without regard to its conflict of laws principles. However, if any provision is unenforceable under Missouri law, and the Buildingstars business is located outside of Missouri where the provision would be enforceable, then the law of the state where the business is located will govern that specific provision.
This means that while Missouri law generally applies to the Buildingstars Franchise Agreement, federal trademark law takes precedence when trademark issues are involved. This is a standard practice in franchising, as trademark protection is a federal matter. The agreement also provides a mechanism for applying the law of the state where the franchise is located if a specific provision is unenforceable under Missouri law but enforceable in the franchisee's state.
For a prospective Buildingstars franchisee, this clause ensures that federal trademark laws will protect the brand and marks. It also offers some flexibility by allowing the application of local state law if a specific provision in the agreement is unenforceable under Missouri law but valid in the state where the franchise operates. Franchisees should be aware of the specific laws in their state and how they might interact with the franchise agreement, especially if they differ from Missouri law.