According to the Checkers Franchise Agreement, which state's laws apply?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
Any general releases you sign will not apply to the extent prohibited by the Maryland Franchise Registration and Disclosure Law. (See Exhibit K to the Franchise Disclosure Document for the form of general release that we currently intend to use in connection with franchise transfers and renewals.)
Any limitation on the period of time arbitration and/or litigation claims must be brought shall not act to reduce the 3 year statute of limitations afforded a franchisee for bringing a claim arising under the Maryland Franchise Registration and Disclosure Law.
Any claims arising under the Maryland Franchise Registration and Disclosure Law must be brought within 3 years after the grant of the franchise.
No disclaimer, questionnaire, clause, or statement signed by a franchisee in connection with the commencement of the franchise relationship shall be construed or interpreted as waiving any claim of fraud in the inducement, whether common law or statutory, or as disclaiming reliance on or the right to rely upon any statement made or information provided by any franchisor, broker or other person acting on behalf of the franchisor that was a material inducement to a franchisee's investment. This provision supersedes
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
The 2025 Checkers Franchise Disclosure Document includes addenda for several states that have specific franchise laws. For example, the addendum for Maryland states that certain provisions within the Franchise Agreement will not apply to liability claims arising under the Maryland Franchise Registration and Disclosure Law, and that lawsuits can be commenced against Checkers in Maryland for these claims, subject to arbitration obligations. Similarly, the addendum for Virginia addresses the unlawful cancellation of a franchise without reasonable cause as defined by the Virginia Retail Franchising Act.
For franchisees in Michigan, the FDD states that certain unfair provisions that might be in the franchise documents are void and unenforceable. These provisions are outlined in the Michigan addendum.
These addenda indicate that while the Franchise Agreement likely contains a general choice-of-law provision, the specific franchise laws of these states (Maryland, Virginia, and Michigan) will take precedence in certain situations to protect the franchisee's rights and ensure compliance with local regulations. A prospective franchisee should carefully review the addendum for their specific state to understand how local laws modify the standard Franchise Agreement. It is advisable to seek legal counsel to fully understand the implications of these state-specific provisions.