Does the Carls Jr. franchise agreement specify where CKR can file a suit against the franchisee?
Carls_Jr Franchise · 2025 FDDAnswer from 2025 FDD Document
The parties agree that, to the extent any disputes cannot be resolved directly between them, Franchisee shall file any suit against CKR only in the federal or state court having jurisdiction where CKR's principal offices are located at the time suit is filed.
CKR may file suit in the federal or state court located in the jurisdiction where CKR's principal offices are located at the time suit is filed, in the jurisdiction where Franchisee resides or does business, where any Franchised Restaurant is or was located, where the claim arose or where Franchisor has its principal offices at the time suit is filed.
Franchisee consents to the personal jurisdiction of those courts over Franchisee and venue in those courts.
Source: Item 23 — RECEIPTS (FDD pages 76–364)
What This Means (2025 FDD)
According to the 2025 Carls Jr. Franchise Disclosure Document, the agreement outlines specific jurisdictions where CKR (Carl's Jr. Restaurants LLC) may file a lawsuit against a franchisee. CKR has the option to file suit in the federal or state court located in the jurisdiction where CKR's principal offices are located at the time the suit is filed. Alternatively, CKR can file suit in the jurisdiction where the franchisee resides or conducts business.
Additionally, CKR may also file suit where any franchised restaurant is or was located, where the claim originated, or where the franchisor has its principal offices at the time the suit is filed. The franchisee, by agreeing to the franchise terms, consents to the personal jurisdiction of these courts and agrees to the venue in those courts. This means a franchisee could potentially face legal action from Carls Jr. in multiple locations depending on the specifics of the dispute.
This section of the franchise agreement is important for prospective franchisees to understand, as it clarifies the legal landscape in case of disputes. Franchisees should be aware that they may be required to defend themselves in a court that is not necessarily in their home state, which could increase legal costs and logistical challenges. It is advisable for potential franchisees to consult with a legal professional to fully understand the implications of this jurisdiction clause.