Does the limitation of claims section in the Area Development Agreement for Cicis require franchisees to waive compliance with the Illinois Franchise Disclosure Act?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
- LIMITATIONS OF CLAIMS. Section 9.F. ("Limitation of Claims") of the Area Development Agreement is amended by adding the following:
However, nothing contained in this Section shall constitute a condition, stipulation, or provision purporting to bind any person to waive compliance with any provision of the Illinois Franchise Disclosure Act at Section 705/27 or any other law of the State of Illinois, to the extent applicable.
- ILLINOIS FRANCHISE DISCLOSURE ACT. The following is added to the end of the Area Development Agreement:
Except for the U.S. Federal Arbitration Act and other federal laws in the U.S., the laws of the State of Illinois will govern this Agreement.
Section 4 of the Illinois Franchise Disclosure Act provides that any provision in an area development agreement that designates jurisdiction outside the State of Illinois is void.
However, an area development agreement may provide for dispute resolution outside of Illinois.
Section 41 of the Illinois Franchise Disclosure Act provides that any condition, stipulation or provision purporting to bind any person acquiring any franchise to waive compliance with the Illinois Franchise Disclosure Act or any other law of Illinois is void.
Franchisee's rights upon termination and non-renewal of an area development agreement are subject to sections 19 and 20 of the Illinois Franchise Disclosure Act.
No statement, questionnaire or acknowledgement 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 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 58–64)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, the Area Development Agreement's limitation of claims section does not require franchisees to waive compliance with the Illinois Franchise Disclosure Act. Specifically, the document states that nothing in the limitation of claims section should be interpreted as binding anyone to waive compliance with the Illinois Franchise Disclosure Act at Section 705/27 or any other Illinois law, to the extent applicable. This provision is designed to protect the rights of franchisees in Illinois and ensure that they are not unknowingly giving up their legal protections under state law.
This protection is further reinforced by additional clauses within the Area Development Agreement. The document explicitly states that any condition, stipulation, or provision that attempts to bind a person to waive compliance with the Illinois Franchise Disclosure Act or any other law of Illinois is void. This ensures that no part of the agreement can be interpreted to force a franchisee to relinquish their rights under Illinois law. Furthermore, any statement, questionnaire, or acknowledgment signed by a franchisee cannot waive claims under applicable state franchise law, including claims of fraud in the inducement, or disclaim reliance on statements made by Cicis.
For a prospective Cicis franchisee in Illinois, this means that the Area Development Agreement is structured to comply with Illinois law and protect their rights. They cannot be compelled to waive their rights under the Illinois Franchise Disclosure Act, and any attempt to do so within the agreement is legally void. This provides a level of assurance that the franchisee's legal rights are protected throughout the franchise relationship. Cicis is also prevented from enforcing any provision that designates jurisdiction outside of Illinois, although dispute resolution may occur outside of the state.