Does the Cool Binz franchise agreement include a waiver of punitive damages?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
OF WHICH PARTY BRINGS SUIT. THIS WAIVER WILL APPLY TO ANY MATTER WHATSOEVER BETWEEN THE PARTIES HERETO WHICH ARISES OUT OF OR IS RELATED IN ANY WAY TO THIS PERSONAL GUARANTY OR THE FRANCHISE AGREEMENT, THE PERFORMANCE OF EITHER
- PARTY, AND/OR YOUR PURCHASE FROM FRANCHISOR OF THE FRANCHISE, OPTION AND/OR ANY GOODS OR SERVICES.
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- Waiver of Punitive Damages. You waive to the fullest extent permitted by law, any right to or claim for any punitive, exemplary, incidental, indirect, special or consequential damages (including, without limitation, lost profits) that you may have against us arising out of any cause whatsoever (whether such cause be based in contract, negligence, strict liability, other tort or
Source: Item 23 — RECEIPTS (FDD pages 63–238)
What This Means (2025 FDD)
According to Cool Binz's 2025 Franchise Disclosure Document, the franchise agreement includes a waiver of punitive damages. Specifically, the franchisee waives any right to claim punitive, exemplary, incidental, indirect, special, or consequential damages against Cool Binz. This waiver extends to any cause of action, whether based in contract, negligence, strict liability, or other tort. The agreement limits the franchisee's recovery to actual damages in the event of a dispute.
This waiver means that a Cool Binz franchisee is limited to recovering only direct losses if they sue Cool Binz, and cannot seek additional damages intended to punish the franchisor. Such waivers are relatively common in franchise agreements, shifting some of the risk of disputes onto the franchisee.
However, the FDD also notes that for franchisees operating in Minnesota, Minnesota Rule 2860.4400J prohibits the waiver of a jury trial. This suggests that while punitive damage waivers may be generally included, their enforceability can vary by state law. Prospective franchisees should consult with an attorney to understand the specific implications of these waivers in their state.