Does the waiver of punitive damages and jury trial 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
- WAIVER OF PUNITIVE DAMAGES AND JURY TRIAL. The following language is added to the end of Section 9.C. ("Waiver of Punitive Damages and Jury Trial") of the Area Development Agreement:
However, this Section shall not act as a condition, stipulation or provision purporting to bind any person acquiring any franchise to waive compliance with any provision of the Illinois Franchise Disclosure Act at Section 705/41 or Illinois regulations at Section 200.609.
- 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.
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 waiver of punitive damages and jury trial in the Area Development Agreement does not require franchisees to waive compliance with the Illinois Franchise Disclosure Act. The FDD explicitly states that the waiver of punitive damages and jury trial shall not act as a condition, stipulation, or provision purporting to bind any person acquiring any franchise to waive compliance with any provision of the Illinois Franchise Disclosure Act at Section 705/41 or Illinois regulations at Section 200.609. This ensures that franchisees retain their rights and protections under Illinois law, even with the inclusion of a waiver of punitive damages and jury trial in the Area Development Agreement.
Furthermore, the FDD includes a section specifically addressing the Illinois Franchise Disclosure Act, reinforcing the protection of franchisees' rights. It states 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. This provision underscores Cicis's commitment to adhering to Illinois franchise law and ensuring that franchisees are not compelled to relinquish their legal rights.
In addition to the Area Development Agreement, the Franchise Agreement also contains similar provisions to protect franchisees' rights under the Illinois Franchise Disclosure Act. The Franchise Agreement states that the waiver of damages, waiver of jury trial, and limitation of liability shall not 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. This consistent inclusion of protective language in both agreements demonstrates Cicis's intent to uphold franchisees' rights and comply with Illinois franchise law.