What are the implications of the California Franchise Investment Law for the City Publications franchise offering?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
| FOR THE STATE OF CAL | IFORNIA |
|---|---|
| ---------------------- | --------- |
| Year ending December 31: | ||
|---|---|---|
| 2025 | $ 29,393 | |
| 2026 | 22,613 |
-
- In recognition of the requirements of the California Franchise Investment Law, Cal. Corp. Code §§31000-31516 and the California Franchise Relations Act, Cal. Bus. And Prof. Code §§20000-20043, the Franchise Agreement for CITY PUBLICATIONS FRANCHISE GROUP, INC. shall be amended as follows:
- The California Franchise Relations Act provides rights to the Franchise concerning termination or nonrenewal of the Franchise Agreement, which may supersede provisions in the Franchise Agreement, specifically Sections 5.B and 19.
- Sections 5B.10 and 20B.2 of the Franchise Agreement require Franchisee to sign a general release as a condition of renewal and transfer of the franchise; such release shall exclude claims arising under California Franchise Investment Law and California Franchise Relations Act.
- Section 17A of the Franchise Agreement contains a covenant not to compete which extends beyond the expiration or termination of the Franchise Agreement; this covenant may not be enforceable under California law.
- Section 18B.1.h of the Franchise Agreement which terminates the Franchise Agreement upon the bankruptcy of the Franchisee may not be enforceable under federal bankruptcy law (11 U.S.C. Section 101, et seq.).
- The Franchise Agreement requires litigation to be conducted in a court located in the State of Georgia. This provision might not be enforceable for any cause of action arising under California law.
- The Franchise Agreement requires application of the laws of the State of Georgia. This provision might not be enforceable under California law.
- Section 19E of the Franchise Agreement contains a liquidated damages clause. Under California Civil Code Section 1671, certain liquidated damages clauses are unenforceable.
Source: Item 23 — RECEIPT (FDD pages 39–129)
What This Means (2025 FDD)
According to the 2025 City Publications Franchise Disclosure Document, the California Franchise Investment Law and the California Franchise Relations Act have several implications for the franchise agreement.
The Franchise Agreement for City Publications is amended to reflect California law. Specifically, the California Franchise Relations Act may supersede provisions in the Franchise Agreement concerning termination or nonrenewal, particularly Sections 5.B and 19. Any general release that City Publications requires franchisees to sign for renewal or transfer must exclude claims arising under the California Franchise Investment Law and California Franchise Relations Act.
Furthermore, the covenant not to compete in Section 17A of the Franchise Agreement, which extends beyond the agreement's expiration or termination, might not be enforceable under California law. The FDD also notes that the Franchise Agreement requires litigation to be conducted in a court located in the State of Georgia, but this provision might not be enforceable for any cause of action arising under California law. Similarly, the Franchise Agreement requires application of the laws of the State of Georgia, but this provision might not be enforceable under California law.
Finally, the California Franchise Investment Law requires that a copy of all proposed agreements relating to the sale of the City Publications franchise be delivered together with the disclosure document. The disclosure document also states that no statement, questionnaire, or acknowledgment signed by a franchisee can waive claims under any applicable state franchise law, including fraud in the inducement, or disclaim reliance on any statement made by City Publications or anyone acting on its behalf.