In Minnesota, can a C12 Group franchisee consent to termination penalties?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
Minn. Rule Part 2860.4400J. prohibits a franchisee from waiving his rights to a jury trial or waiving his rights to any procedure, forum, or remedies provided for by the laws of the jurisdiction, or consenting to liquidated damages, termination penalties or judgment notes. With respect to Franchises governed by Minnesota law, any provisions to the contrary in the disclosure document and/or the franchise agreement are hereby deemed to be deleted.
Source: Item 23 — RECEIPTS (FDD pages 46–137)
What This Means (2025 FDD)
According to C12 Group's 2025 Franchise Disclosure Document, Minnesota law prohibits a franchisee from consenting to termination penalties. Specifically, Minn. Rule Part 2860.4400J prohibits a franchisee from waiving rights to a jury trial, waiving rights to any procedure, forum, or remedies provided by the laws of the jurisdiction, or consenting to liquidated damages, termination penalties or judgment notes.
For a prospective C12 Group franchisee in Minnesota, this means that any provision in the franchise agreement that allows for termination penalties is not enforceable. The FDD explicitly states that any provisions to the contrary in the disclosure document and/or the franchise agreement are deemed to be deleted with respect to franchises governed by Minnesota law.
This protection ensures that C12 Group franchisees in Minnesota retain all their legal rights and remedies under Minnesota law, preventing them from being forced to accept potentially unfair or punitive termination penalties. This is a significant benefit for franchisees as it provides a legal safeguard against potentially overreaching actions by the franchisor.