Under what circumstances are covenants not to compete upon termination or expiration of the Franchise Agreement enforceable for City Publications franchises in North Dakota?

According to the 2025 City Publications Franchise Disclosure Document, covenants not to compete upon termination or expiration of the Franchise Agreement are generally unenforceable in North Dakota, except in limited instances as provided by North Dakota law. This means that while City Publications includes a standard non-compete clause in its franchise agreement, its enforceability is restricted by North Dakota state law.

For a prospective City Publications franchisee in North Dakota, this amendment offers some protection. After the franchise agreement ends, the franchisee may be able to engage in a competing business, subject to specific limitations defined by North Dakota law. This is a significant point, as non-compete clauses can severely restrict a franchisee's future business activities after leaving a franchise system.

However, the FDD does not specify what these 'limited instances' are under North Dakota law. Therefore, a prospective franchisee should seek legal counsel to understand the specific circumstances under which a non-compete agreement might be enforced in North Dakota. This would involve researching relevant North Dakota statutes and case law to determine the scope and limitations of the non-compete clause.

It is important for potential City Publications franchisees to consult with an attorney to fully understand their rights and obligations under North Dakota law, especially regarding non-compete agreements. This will help them make informed decisions about their business ventures after the franchise agreement concludes.