Does the Canine Dimensions franchise agreement include a waiver of punitive damages?
Canine_Dimensions Franchise · 2025 FDDAnswer from 2025 FDD Document
RANCHISEE: | | Witness | |
ADDENDUM TO CANINE DIMENSIONS FRANCHISING, LLC DISCLOSURE DOCUMENT FOR THE STATE OF MINNESOTA
Despite anything to the contrary in the Franchise Agreement, the following provisions will supersede and apply to all franchises offered and sold in the State of Minnesota:
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- Any provision in the Franchise Agreement that would require you to assent to a release, assignment, novation or waiver that would relieve any person from liability imposed by Minnesota Statutes, Sections 80C.01 to 80C.22 will be void to the extent that such contractual provision violates such law.
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- Minnesota Statute Section 80C.21 and Minnesota Rule 2860.4400J prohibit the franchisor from requiring litigation to be conducted outside of Minnesota. In addition, nothing in the Franchise Disclosure Document or Agreement can abrogate or reduce any of your rights as provided for in Minnesota Statutes, Chapter 80C, or your rights to any procedure, forum, or remedies provided for by the laws of Minnesota.
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- 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. Any provision in the Agreement which would require you to waive your rights to any procedure, forum or remedies provided for by the laws of the State of Minnesota is deleted from any Agreement relating to franchises offered and sold in the State of Minnesota; provided, however, that this paragraph will not affect the obligation in the Agreement relating to arbitration.
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- With respect to franchises governed by Minnesota law, we will comply with Minnesota Statute Section 80C.14, Subds. 3, 4 and 5, which require, except in certain specified cases, that you be given 90 days notice of termination (with 60 days to cure) and 180 days notice for non-renewal of the Agreement; and that consent to the transfer of the franchise will not be unreasonably withheld.
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- Item 13 of the FDD is hereby amended to state that we will protect your rights under this Agreement to use the Marks, or indemnify you from any loss, costs, or expenses arising out of any third-party claim, suit or demand regarding your use of the Marks, if your use of the Marks is in compliance with the provisions of the Agreement and Our System standards.
Source: Item 22 — CONTRACTS (FDD page 36)
What This Means (2025 FDD)
Based on the 2025 Canine Dimensions Franchise Disclosure Document, the franchise agreement's stance on waivers, particularly concerning punitive damages, varies by state. For instance, in Minnesota, any provision requiring a franchisee to waive rights to procedures, forums, or remedies under Minnesota law is deleted from agreements for franchises sold in that state. Similarly, in Iowa, any provision requiring a prospective waiver that relieves a person from liability imposed by the Iowa Business Opportunity Promotions Law is void. Illinois law also voids any condition that binds a person acquiring a franchise to waive compliance with the Illinois Franchise Disclosure Act or any other law of Illinois. These stipulations suggest that while the standard Canine Dimensions franchise agreement might contain waiver provisions, these are superseded by state laws designed to protect franchisees. Therefore, the enforceability of a punitive damages waiver would depend on the specific state's franchise laws and how they interact with the franchise agreement.
In California, the FDD mentions that the California Franchise Investment Law requires that a copy of all proposed agreements relating to the sale of the franchise be delivered together with the disclosure document. It also states that under California Civil Code Section 1671, certain liquidated damages clauses are unenforceable. This suggests that while there may be clauses related to damages, their enforceability is subject to state law. The document does not explicitly state whether the franchise agreement includes a waiver of punitive damages, but it does highlight areas where state laws override or modify the standard agreement terms to protect franchisees' rights and remedies.
Prospective franchisees should carefully review the addenda specific to their state and consult with legal counsel to understand the full scope of waivers and releases within their franchise agreement. They should also inquire with Canine Dimensions about whether the standard franchise agreement contains a waiver of punitive damages and how that waiver interacts with the laws of the state in which they plan to operate their franchise.