Is Crisp & Green allowed to require a franchisee to consent to liquidated damages in Minnesota?
Crisp_Green Franchise · 2024 FDDAnswer from 2024 FDD Document
Minn. Stat. § 80C.21 and Minn. Rules Part 2860.4400J prohibit us from requiring litigation to be conducted outside the state of Minnesota, requiring waiver of a jury trial, or requiring you 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 your rights as provided for in Minnesota Statutes and/or Chapter 80C, or (2) your rights to any procedure, forum or remedies provided for by the laws of the state of Minnesota. Minn. Rules Part 2860.4400J states that you cannot consent to us obtaining injunctive relief. However, we may seek injunctive relief and a court will determine if a bond is required.
Source: Item 23 — RECEIPTS (FDD pages 66–252)
What This Means (2024 FDD)
According to Crisp & Green's 2024 Franchise Disclosure Document, Crisp & Green is prohibited from requiring a franchisee to consent to liquidated damages in the state of Minnesota. The FDD outlines specific protections for franchisees under Minnesota law, ensuring that franchisees are not forced into agreements that waive their rights or remedies. This protection is explicitly stated within an addendum to the franchise agreement specific to Minnesota.
This provision means that Crisp & Green cannot include clauses in their franchise agreements that mandate franchisees to agree to a predetermined amount of damages in the event of a breach of contract. This is designed to protect franchisees from potentially unfair or excessive financial penalties. Minnesota law aims to create a more balanced relationship between the franchisor and franchisee by preventing the franchisor from imposing such terms.
Prospective Crisp & Green franchisees in Minnesota should be aware of this protection, as it ensures they cannot be compelled to consent to liquidated damages, termination penalties, or judgment notes. This addendum also reinforces that no agreement signed by the franchisee can waive rights under Minnesota franchise law or disclaim reliance on statements made by Crisp & Green. This helps to ensure that franchisees are fully informed and protected under the law.