Does this section of the Cream FDD apply if my franchised business will be located in Ohio?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
it and bind certain third-party nonsignatories. The provisions of this Section will continue in full force and effect subsequent to and notwithstanding the expiration or termination of this Agreement.
Any provisions of this Agreement below that pertain to judicial proceedings shall be subject to the agreement to arbitrate contained in this Section.
G. GOVERNING LAW.
Except to the extent governed by the United States Trademark Act of 1946 (Lanham Act, 15 U.S.C. Sections 1051 et seq.), or other United States federal law, this Agreement and any related agreements, the franchise for your Shop, and all claims arising from the relationship between us or any of our affiliates (and our and their respective owners, officers, directors, agents, representatives and employees), and you (and your owners, guarantors, affiliates, and employees), will be governed by the laws of the State of Ohio, without regard to its conflict of laws rules. Any state law regulating the offer or sale of franchises or governing the relationship of a franchisor and its franchisee, including the terms set forth on Attachment F (as applicable), will not apply unless the jurisdictional requirements of such state law are met independently without reference to this Section.
H.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to the 2025 Cream FDD, the franchise agreement and related agreements will generally be governed by Ohio law if your franchised business is located in Ohio. Specifically, the FDD indicates that, except to the extent governed by federal law, the franchise agreement, any related agreements, and all claims arising from the relationship between Cream and the franchisee will be governed by the laws of Ohio, without regard to its conflict of laws rules. This means that Ohio law will dictate how the franchise agreement is interpreted and enforced. However, this is with the exception that any state law regulating the offer or sale of franchises or governing the relationship of a franchisor and its franchisee, will not apply unless the jurisdictional requirements of such state law are met independently.
Furthermore, the Cream FDD states that franchisees and their owners agree that all actions arising under the Franchise Agreement or as a result of the relationship between the franchisee and Cream must be commenced in the court nearest to Cream's principal place of business, which is currently in Columbus, Ohio. Franchisees and their owners must irrevocably submit to the jurisdiction of that court and waive any objection to the jurisdiction or venue in that court, subject to the obligation to arbitrate.
In effect, this means that if a Cream franchisee operates their franchise in Ohio, Ohio law will likely govern the franchise agreement, and any legal disputes will likely be resolved in Ohio courts, unless arbitration is required. However, it's important to note that the specific terms of the franchise agreement and any state-specific riders (attachments) could modify these general rules, so franchisees should carefully review the entire agreement and seek legal counsel to fully understand their rights and obligations.