Under what circumstances is a release or waiver of rights by a Cinnaholic franchisee valid under the Washington Franchise Investment Protection Act?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
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 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 42–50)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, a release or waiver of rights within the franchise agreement or related documents, which aims to waive compliance with any provision of the Washington Franchise Investment Protection Act, is generally void. However, there is an exception. Such a release or waiver is valid if it is executed as part of a negotiated settlement after the franchise agreement is already in effect. Furthermore, for the waiver to be valid, both Cinnaholic and the franchisee must be represented by independent legal counsel during the negotiation and execution of the settlement, in accordance with RCW 19.100.220(2). This statute likely ensures that franchisees are not coerced into waiving their rights without understanding the implications and having proper legal guidance.
Additionally, any release or waiver executed in connection with a renewal or transfer of a Cinnaholic franchise is also generally void, with the same exception as above. This means that franchisees cannot be forced to waive their rights under the Washington Franchise Investment Protection Act as a condition of renewing or transferring their franchise, unless the same conditions of a negotiated settlement with independent counsel are met, as outlined in RCW 19.100.220(2).
This provision protects Cinnaholic franchisees in Washington from unknowingly or unfairly relinquishing their rights under the state's franchise laws. It ensures that any waiver of these rights is made knowingly, voluntarily, and with the benefit of independent legal advice, especially in situations like settlements, renewals, or transfers where franchisees might feel pressured to agree to unfavorable terms.