For Crave franchisees, where are they permitted to bring a lawsuit for claims arising under the Maryland Franchise Registration and Disclosure Law?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
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ADDENDUM TO THE FRANCHISE AGREEMENT REQUIRED BY THE STATE OF MARYLAND
This will serve as the State Addendum for the State of Maryland for CRAVE Franchising, LLC's Franchise Agreement. The amendments to the Franchise Agreement included in this addendum have been agreed to by the parties.
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- The provisions in the Franchise Agreement which provide for termination upon bankruptcy of the franchisee may not be enforceable under federal bankruptcy law (11 U.S.C. Section 101 et seq.).
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- The appropriate sections of the Franchise Agreement are amended to permit a franchisee to bring a lawsuit in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law.
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- The appropriate sections of the Franchise Agreement are amended to state that any claims arising under the Maryland Franchise Registration and Disclosure Law must be brought within three years after the grant of the franchise.
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- The appropriate sections of the Franchise Agreement are amended to state that, pursuant to COMAR 02.02.08.16L, the general release required as a condition of renewal, sale and/or assignment/transfer shall not apply to any liability under the Maryland Franchise Registration and Disclosure Law.
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Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, both the Franchise Agreement and the Multi-Unit Development Agreement are amended to allow a franchisee to file a lawsuit in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law. This amendment ensures that Crave franchisees are able to pursue legal claims related to franchise registration and disclosure within the state of Maryland.
This provision is particularly important because the standard franchise agreement might have clauses that could be interpreted as restricting the franchisee's ability to sue in Maryland. The addendum specifically overrides any such clauses to protect the franchisee's rights under Maryland law. This also addresses concerns about potential conflicts with federal arbitration laws, as the enforceability of forum selection requirements can be disputed.
Additionally, the FDD states that any claims arising under the Maryland Franchise Registration and Disclosure Law must be brought within three years after the grant of the franchise. This means a Crave franchisee needs to be aware of this statute of limitations and act promptly if they believe they have a claim.
The Crave FDD also clarifies that general releases required for renewal, sale, or transfer of the franchise do not apply to liabilities under the Maryland Franchise Registration and Disclosure Law. Furthermore, any statements requiring a franchisee to waive liability are not intended to act as a waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law. These stipulations provide additional protection for franchisees, ensuring their rights under Maryland franchise law are preserved throughout their relationship with Crave.