What claim does the Crave franchisee waive against the franchisor for any business failure?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
BY EXECUTING THE FRANCHISE AGREEMENT, FRANCHISEE AND ANY PRINCIPAL, INDIVIDUALLY AND ON BEHALF OF FRANCHISEE'S AND SUCH PRINCIPAL'S HEIRS, LEGAL REPRESENTATIVES, SUCCESSORS AND ASSIGNS, HEREBY FOREVER RELEASE AND DISCHARGE CRAVE FRANCHISING, LLC AND ANY OF ITS PARENT COMPANY, SUBSIDIARIES, DIVISIONS, AFFILIATES, SUCCESSORS, ASSIGNS AND DESIGNEES, AS WELL AS THEIR DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, AND SHAREHOLDERS FROM ANY AND ALL CLAIMS, DEMANDS AND JUDGMENTS RELATING TO OR ARISING UNDER THE STATEMENTS, CONDUCT, CLAIMS OR ANY OTHER AGREEMENT BETWEEN THE PARTIES EXECUTED PRIOR TO THE DATE OF THE FRANCHISE AGREEMENT, INCLUDING, BUT NOT LIMITED TO, ANY AND ALL CLAIMS, WHETHER PRESENTLY KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED, ARISING UNDER THE FRANCHISE, SECURITIES, TAX OR ANTITRUST LAWS OF THE UNITED STATES OR OF ANY STATE OR TERRITORY THEREOF. THIS RELEASE IS SPECIFICALLY INAPPLICABLE TO ANY CLAIMS ARISING FROM REPRESENTATIONS MADE BY FRANCHISOR IN FRANCHISOR'S FRANCHISE DISCLOSURE DOCUMENT RECEIVED BY FRANCHISEE.
Initial
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, franchisees, along with their principals, agree to release and discharge Crave Franchising, LLC from any claims, demands, and judgments related to agreements executed prior to the date of the Franchise Agreement. This includes claims that are currently unknown or unsuspected, arising under franchise, securities, tax, or antitrust laws. However, this waiver does not apply to claims arising from representations made by Crave in its Franchise Disclosure Document.
In practical terms, this means a Crave franchisee gives up the right to sue Crave for issues stemming from prior agreements, except for misrepresentations in the FDD itself. This is a significant commitment, as it limits the franchisee's legal recourse against Crave for past actions. The franchisee is also agreeing not to bring any suit, action, or proceeding, or make any demand or claim against any Released Franchisor Party with respect to any Franchisee Released Claim, and shall defend, indemnify, and hold harmless each of Franchisor Releasees against same.
This type of waiver is common in franchise agreements, as it aims to protect the franchisor from potential liabilities related to past dealings. However, franchisees should carefully consider the implications before signing, as it could limit their ability to seek compensation for past issues. It is important to note the exception for misrepresentations in the FDD, which provides some protection to the franchisee. Franchisees should consult with an attorney to fully understand the scope and implications of this waiver before signing the Franchise Agreement.