Are there any exceptions to the waiver of punitive damages between City Publications franchisee and franchisor?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee and Franchisor each waive, to the fullest extent permitted by law, any right or claim for any punitive or exemplary damages against the other, and agrees that if there is a dispute with the other, each will be limited to the recovery of actual damages sustained by it including reasonable accounting and/or legal fees as provided in Section 23.C. Franchisee waives and disclaims any right to consequential damages in any action or claim against Franchisor concerning this Agreement or any related agreement. In any claim or action brought by Franchisee against Franchisor concerning this Agreement, Franchisee's contract damages shall not exceed and shall be limited to refund of Franchisee's Franchise and Royalty Fee payments.
Source: Item 23 — RECEIPT (FDD pages 39–129)
What This Means (2025 FDD)
According to City Publications' 2025 Franchise Disclosure Document, both the franchisee and franchisor waive any right to claim punitive or exemplary damages against each other to the fullest extent permitted by law. This means that in the event of a dispute, both parties are limited to recovering only the actual damages they sustained.
This waiver does not apply to claims arising from falsification of reports, abandonment, trademark infringement, and non-compete provisions. For these specific types of disputes, the waiver of punitive damages does not apply, and the parties may seek such damages if they are available under applicable law.
In any claim or action brought by a franchisee against City Publications, the franchisee's contract damages are limited to a refund of the franchise and royalty fee payments. This limitation on damages, along with the waiver of punitive damages, is a significant consideration for potential franchisees, as it restricts the potential financial recovery in case of a dispute with City Publications.