If a Cinnaholic Developer enters into litigation with the Franchisor, does the agreement prevent the Developer from litigating in Maryland, despite the requirement to submit to court proceedings in the state where the Franchisor's principal executive office is located?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Under certain circumstances, the Agreement requires Developer to submit to a court proceeding in the State where Franchisor's principal executive office is located. These provisions may run contrary to the Maryland Franchise Registration and Disclosure Law. Therefore, nothing will preclude Developer from being able to enter into litigation with Franchisor in Maryland.
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- Any claims arising under the Maryland Franchisor Registration and Disclosure Law must be brought within three years after the grant of the franchise.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 42–50)
What This Means (2025 FDD)
According to the 2025 Cinnaholic Franchise Disclosure Document, specifically the addendum to the Market Development Agreement for Maryland developers, the agreement does not prevent a developer from litigating in Maryland. Despite any clause requiring developers to submit to court proceedings in the state where Cinnaholic's principal executive office is located, the addendum clarifies that this does not preclude a developer from initiating litigation against Cinnaholic in Maryland.
This provision is designed to comply with the Maryland Franchise Registration and Disclosure Law, ensuring that Maryland-based developers retain their rights under state law. This means a Cinnaholic developer in Maryland has the right to bring legal action against the franchisor within the state, regardless of any conflicting clauses in the standard agreement.
Furthermore, any claims arising under the Maryland Franchisor Registration and Disclosure Law must be brought within three years after the grant of the franchise. This timeframe sets a limit on when a developer can bring such claims, so it's important to be aware of this deadline. This addendum aims to protect the legal rights of Cinnaholic developers operating in Maryland, ensuring they are not unduly restricted by standard agreement terms that might conflict with Maryland law.