Are there any exceptions to the confidentiality restrictions for Creative World School franchisees?
Creative_World_School Franchise · 2025 FDDAnswer from 2025 FDD Document
CREATIVE WORLD SCHOOLS FRANCHISING COMPANY, INC. YOU
ADDENDUM TO FRANCHISE DISCLOSURE DOCUMENT FOR CREATIVE WORLD SCHOOLS FRANCHISING COMPANY, INC. STATE OF MARYLAND
- The following is added to the disclosure document:
No statement, questionnaire or acknowledgement signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of: (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on behalf of the Franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
- Sections (c) and (m) of Item 17 are amended by adding the following language:
The general release required as a condition of renewal, sale, and/or assignment or transfer will not apply to any liability under the Maryland Franchise and Disclosure Law (the "Maryland Law").
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- Item 17 is amended by adding the following language after the table:
- (a) The provision of the Franchise Agreement that provides for termination upon bankruptcy of the franchisee may not be enforceable under federal bankruptcy law (11 U.S.C. Section 101, et seq.)
- (b) Any claims arising under the Maryland Law must be brought within 3 years after the grant of the franchise.
- (c) A franchisee may bring a lawsuit in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law.
RIDER TO CREATIVE WORLD SCHOOLS FRANCHISING COMPANY, INC. FRANCHISE AGREEMENT FOR USE IN MARYLAND
Source: Item 23 — RECEIPTS (FDD pages 80–247)
What This Means (2025 FDD)
The 2025 Creative World School Franchise Disclosure Document includes addenda for several states that address waivers and releases. Specifically, these addenda state that no statement, questionnaire, or acknowledgement signed by a franchisee can waive claims under applicable state franchise law, including fraud in the inducement, or disclaim reliance on the franchisor. This provision overrides any conflicting terms in other documents related to the franchise agreement. This suggests that while there are confidentiality restrictions, franchisees retain their rights under state franchise laws.
For franchisees in Maryland, the general release required for renewal, sale, assignment, or transfer does not apply to liabilities under the Maryland Franchise and Disclosure Law. Additionally, franchisees in Maryland can bring lawsuits within the state for claims arising under the Maryland Franchise Registration and Disclosure Law, with a statute of limitations of three years from the franchise grant. These stipulations ensure that franchisees do not waive their rights under Maryland law through standard releases.
In Illinois, any condition, stipulation, or provision in the franchise agreement that waives compliance with any provision of the Illinois Act or any other Illinois law is void. This ensures that Illinois franchisees are protected by state laws, and any attempt to waive these protections within the franchise agreement is unenforceable. These state-specific addenda provide franchisees with additional protections and clarify the limits of waivers and releases, ensuring compliance with local laws and regulations.