Can Bumper Man obtain an injunction to prevent a franchisee from asserting a claim that was released?
Bumper_Man Franchise · 2025 FDDAnswer from 2025 FDD Document
- **5.
Complete Defense.** Franchisee and Guarantors: (i) acknowledge that this Release shall be a complete defense to any Claim released under Section 1 above; and (ii) consent to the entry of a temporary or permanent injunction to prevent or end the assertion of any such Claim.
- **6.
Successors and Assigns.** This Release will inure to the benefit of and bind the successor, assigns, heirs and personal representatives of Franchisor and each Releasor.
- 7. This Release of Claims does not apply to claims arising under the Franchise Investment Protection Act, chapter 19.100 RCW, or the rules adopted thereunder in accordance with RCW 19.100.220(2).
[The following is to be used only for California franchisees]
Acknowledgment of Releases under California Law. Each Party granting a release acknowledges a familiarity with Section 1542 of the Civil Code of the State of California, which provides as follows:
"A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party."
Source: Item 22 — CONTRACTS (FDD page 45)
What This Means (2025 FDD)
According to Bumper Man's 2025 Franchise Disclosure Document, franchisees and guarantors acknowledge that a release shall be a complete defense to any claim released. They also consent to the entry of a temporary or permanent injunction to prevent or end the assertion of any such claim. This agreement is binding to the successors, assigns, heirs, and personal representatives of Bumper Man and each releasor. However, this release of claims does not apply to claims arising under the Franchise Investment Protection Act, chapter 19.100 RCW, or the rules adopted thereunder in accordance with RCW 19.100.220(2).
This means that Bumper Man franchisees may be required to sign a general release as a condition of transfer or renewal of their Franchise Agreement. This release covers all claims, demands, liabilities, and causes of action, whether known or unknown, that the franchisee may have against Bumper Man. By signing this release, the franchisee agrees not to sue Bumper Man and consents to an injunction preventing them from asserting any released claims.
However, there are some limitations to this release. For example, the release does not apply to claims arising under the Franchise Investment Protection Act in Washington state. Additionally, franchisees in certain states like California acknowledge that a general release does not extend to claims that they do not know or suspect to exist at the time of signing the release. This means that if a franchisee later discovers a claim that they were unaware of at the time of signing the release, they may still be able to pursue that claim.
Prospective franchisees should carefully review the release and understand the claims they are giving up before signing it. They should also be aware of any state laws that may limit the scope of the release. If a franchisee is unsure about the meaning or effect of the release, they should consult with an attorney.