Under what conditions is a release or waiver of rights in the Cinnabon franchise agreement considered void under Washington law?
Cinnabon Franchise · 2025 FDDAnswer from 2025 FDD Document
- **4.
General Release.** A release or waiver of rights in the franchise agreement or related agreements purporting to bind the franchisee to waive compliance with any provision under the Washington Franchise Investment Protection Act or any rules or orders thereunder is void except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel, in accordance with RCW 19.100.220(2).
In addition, any such release or waiver executed in connection with a renewal or transfer of a franchise is likewise void except as provided for in RCW 19.100.220(2).
Source: Item 23 — Receipts (FDD pages 114–399)
What This Means (2025 FDD)
According to Cinnabon's 2025 Franchise Disclosure Document, a release or waiver of rights within the franchise agreement or related documents is generally void in Washington state if it requires the franchisee to waive compliance with any provision of the Washington Franchise Investment Protection Act, including its rules and orders.
However, there are two exceptions to this rule. The first exception is when the release or waiver is executed as part of a negotiated settlement after the franchise agreement is already in effect. In this case, the waiver is only valid if both parties are represented by independent legal counsel. This ensures that the franchisee has proper guidance and is not pressured into relinquishing their rights without understanding the implications.
The second exception applies to releases or waivers executed in connection with a renewal or transfer of the franchise. Similar to the first exception, these waivers are also void unless they meet the conditions specified in RCW 19.100.220(2), which likely involves a negotiated settlement with independent legal representation. This provision aims to protect franchisees during critical junctures like renewal or transfer, preventing them from being coerced into unfavorable terms.
In essence, Washington law seeks to safeguard franchisees from unknowingly or unfairly waiving their rights under the Washington Franchise Investment Protection Act. The law allows for waivers only under specific circumstances where the franchisee has the benefit of independent legal advice and the waiver is part of a genuine settlement or negotiation.