Can a Circle K franchisee in Washington bring an action related to the sale of franchises in Washington?
Circle_K Franchise · 2025 FDDAnswer from 2025 FDD Document
In any arbitration or mediation involving a franchise purchased in Washington, the arbitration or mediation site will be either in the state of Washington, or in a place mutually agreed upon at the time of the arbitration or mediation, or as determined by the arbitrator or mediator at the time of arbitration or mediation. In addition, if litigation is not precluded by the franchise agreement, a franchisee may bring an action or proceeding arising out of or in connection with the sale of franchises, or a violation of the Washington Franchise Investment Protection Act, in Washington. A release or waiver of rights executed by a franchisee may not include rights under the Washington Franchise Investment Protection Act or any rule or order thereunder except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel. Provisions such as those which unreasonably restrict or limit the statute of limitations period for claims under the Act, or rights or remedies under the Act such as a right to a jury trial, may not be enforceable.
Source: Item 22 — CONTRACTS (FDD page 100)
What This Means (2025 FDD)
According to the 2025 Circle K Franchise Disclosure Document, a franchisee in Washington may bring an action or proceeding against Circle K if litigation is not precluded by the franchise agreement. This action must arise out of or be connected with the sale of franchises or a violation of the Washington Franchise Investment Protection Act, and it must be brought in Washington. This means that Circle K franchisees in Washington have certain legal rights and protections under Washington state law related to the sale of their franchises.
This provision ensures that Circle K franchisees in Washington are not forced to litigate disputes in a distant or inconvenient location. It also prevents Circle K from requiring franchisees to waive their rights under the Washington Franchise Investment Protection Act, except in specific circumstances. Specifically, a release or waiver of rights is only permissible if it is executed pursuant to a negotiated settlement after the franchise agreement is in effect and where the parties are represented by independent counsel.
This protection is significant because it allows franchisees to seek legal recourse if they believe Circle K has violated the terms of the franchise agreement or the Washington Franchise Investment Protection Act. The Act aims to protect franchisees from unfair practices by franchisors, and this clause reinforces that protection. Provisions that unreasonably restrict or limit the statute of limitations period for claims under the Act, or rights or remedies under the Act such as a right to a jury trial, may not be enforceable.
Prospective Circle K franchisees in Washington should carefully review the franchise agreement and understand their rights under the Washington Franchise Investment Protection Act. They should also consult with an attorney to ensure that they fully understand the terms of the agreement and their legal options in case of a dispute with Circle K.