Are representations requiring prospective Cilantro Taco Grill franchisees in Maryland to assent to a release, estoppel, or waiver of liability intended to act as a release, estoppel, or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law?
Cilantro_Taco_Grill Franchise · 2024 FDDAnswer from 2024 FDD Document
tates that it is an unfair or deceptive practice to require a franchisee to waive its right to file a lawsuit in Maryland claiming a violation of the Maryland Franchise Law. In light of the Federal Arbitration Act, there is some dispute as to whether this forum selection requirement is legally enforceable.
-
- Item 13 and Item 14 of the Franchise Disclosure Document are amended to state all representations requiring prospective franchisees to assent to a release, estoppel or waiver of liability are not intended to nor shall they act as a release, estoppel or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law.
-
- The appropriate sections of the Franchise Agreement and Multi-Unit Operator Agreement are amended to state that pursuant to COMAR 02.02.08.16L, the general release required as a condition of renewal, sale and/or assignment/ transfer shall not apply to any liability under the Maryland Franchise Registration and Disclosure Law.
-
- Section 17.1 of the Franchise Agreement is hereby amended to further state that our right to terminate you upon your bankruptcy may not be enforceable under federal bankruptcy law (11 U.S.C.
Source: Item 23 — RECEIPT (FDD pages 52–208)
What This Means (2024 FDD)
According to the 2024 Cilantro Taco Grill Franchise Disclosure Document, representations that require prospective franchisees in Maryland to agree to a release, estoppel, or waiver of liability are not intended to act as a release, estoppel, or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law.
Specifically, Item 13 and Item 14 of the Franchise Disclosure Document are amended to reflect this. The relevant sections of the Franchise Agreement and Multi-Unit Operator Agreement are also amended to state that, in accordance with COMAR 02.02.08.16L, any general release required as a condition of renewal, sale, and/or assignment/transfer will not apply to any liability under the Maryland Franchise Registration and Disclosure Law.
Furthermore, the Franchise Agreement, Multi-Unit Operator Agreement, and Franchisee Acknowledgment are amended to include a statement clarifying that all representations requiring prospective franchisees to assent to a release, estoppel, or waiver of liability are not intended to, nor shall they act as, a release, estoppel, or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law. This ensures that franchisees in Maryland retain their rights and protections under Maryland franchise law, regardless of any general releases or waivers they may be asked to sign in other contexts.