In Minnesota, can Crave Cookies require franchisees to consent to liquidated damages?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
Minnesota Statutes, Section 80C.21 and Minnesota Rules 2860.4400(J) prohibit the franchisor from requiring litigation to be conducted outside Minnesota, requiring waiver of a jury trial, or requiring the franchisee to consent to liquidated damages, termination penalties or judgment notes. In addition, nothing in the Franchise Disclosure Document or agreement(s) can abrogate or reduce (1) any of the franchisee's rights as provided for in Minnesota Statutes, Chapter 80C or (2) franchisee's rights to any procedure, forum, or remedies provided for by the laws of the jurisdiction.
Source: Item 23 — RECEIPTS (FDD pages 47–194)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, Minnesota Statutes, Section 80C.21 and Minnesota Rules 2860.4400(J) explicitly prohibit Crave Cookies from requiring franchisees to consent to liquidated damages in the state of Minnesota. This protection is part of a broader set of regulations designed to safeguard franchisee rights within the state.
This means that any clause in the franchise agreement that mandates a franchisee's consent to liquidated damages is unenforceable in Minnesota. Liquidated damages are predetermined amounts specified in a contract that one party must pay to the other in the event of a breach. Minnesota law intervenes to prevent franchisors like Crave Cookies from imposing such requirements on franchisees, ensuring a fairer balance of power.
Furthermore, the FDD emphasizes that nothing within the disclosure document or any related agreements can diminish the rights granted to franchisees under Minnesota Statutes, Chapter 80C, or their access to procedures, forums, or remedies provided by Minnesota law. This reinforces the state's commitment to protecting franchisees' legal recourse and rights.
Prospective Crave Cookies franchisees in Minnesota should be aware of these protections, ensuring they understand their rights under state law. This addendum to the disclosure document serves to modify the standard franchise agreement to comply with Minnesota-specific regulations, offering franchisees additional security and legal standing.