If a Carls franchisee is a resident of Illinois, does the rider apply to them?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
FOR THE FOLLOWING STATES ONLY: CALIFORNIA, HAWAII, ILLINOIS, INDIANA, MARYLAND, MICHIGAN, MINNESOTA, NEW YORK, NORTH DAKOTA, RHODE ISLAND, SOUTH DAKOTA, VIRGINIA, WASHINGTON, WISCONSIN
The following language is hereby added to the Franchise Disclosure Document if you are a resident of one of the states listed in the heading of this Rider (the "Applicable Franchise Registration State") or a non-resident who is acquiring franchise rights permitting the location of one or more Carl's Jr. Restaurants in the Applicable Franchise Registration State:
"No statement, questionnaire, or acknowledgment signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise."
Source: Item 23 — RECEIPTS (FDD pages 80–480)
What This Means (2024 FDD)
According to the 2024 Carls Franchise Disclosure Document, the rider applies to franchisees who are residents of Illinois. The document specifies that the additional language applies if the franchisee is a resident of one of the states listed, which includes Illinois.
This rider modifies the Franchise Disclosure Document for residents of specific states, including Illinois. It states that no statement, questionnaire, or acknowledgment signed by a franchisee can waive claims under state franchise law, including fraud, or disclaim reliance on statements made by Carls or its representatives. This provision takes precedence over any conflicting terms in the franchise agreement.
For a prospective Carls franchisee in Illinois, this rider provides additional protection under Illinois franchise law. It prevents the franchisee from unintentionally waiving their rights or disclaiming reliance on Carls' statements during the franchise commencement. This ensures that franchisees retain their legal rights and protections under Illinois state law, offering a safeguard against potentially overreaching clauses in the standard franchise agreement.