Under the Cicis Area Development Agreement, can a franchisee bring an action in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
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.
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- The following is added to the end of the "Summary" sections of Item 17.c., entitled "Requirements for franchisee to renew or extend", and Item 17.m., entitled "Conditions for franchisor approval of transfer":
Pursuant to COMAR 02.02.08.16L, any release required as a condition of renewal and/or assignment/transfer will not apply to claims arising under the Maryland Franchise Registration and Disclosure Law.
- The following is added to the end of the "Summary" section of Item 17.f., entitled "'Cause' defined - defaults which cannot be cured":
The Area Development Agreement and Franchise Agreement provides for termination upon bankruptcy. This provision might not be enforceable under federal bankruptcy law (11 U.S.C. Sections 101 et seq.), but we will enforce it to the extent enforceable.
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Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 58–64)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, a franchisee can bring an action in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law, despite any provisions in the Area Development Agreement that might suggest otherwise. This protection is specifically outlined in a rider to the Area Development Agreement for use in Maryland.
Specifically, the FDD states that the choice of forum section in Item 17 of the Area Development Agreement is amended to explicitly allow a franchisee to bring a lawsuit in Maryland for claims related to the Maryland Franchise Registration and Disclosure Law. Furthermore, any claims under this law must be initiated within 3 years after Cicis grants the franchise.
This provision ensures that Maryland franchisees are not restricted from pursuing legal recourse within their own state for violations of Maryland franchise law. It also sets a clear timeframe of 3 years for bringing such claims, providing both the franchisee and Cicis with a defined period for potential legal action.