In the context of a Crisp & Green franchise transfer, what does the general release from the franchisee cover?

According to the 2024 Crisp & Green Franchise Disclosure Document, the general release that a franchisee must sign during a transfer does not waive certain liabilities against the franchisor. Specifically, the release does not waive any liability against Crisp & Green parties or their affiliates that may arise under the Washington Franchise Investment Protection Act or any rule or order thereunder. This protection is explicitly mentioned in Item 23 of the FDD.

Furthermore, for franchisees in Maryland, the general release language required as a condition of renewal, sale, assignment, or transfer will not apply to claims arising under the Maryland Franchise Registration and Disclosure Law. This ensures that franchisees in these states retain their rights to pursue claims under their respective state franchise laws, even after signing a general release during a transfer.

In Virginia, the FDD states that no statement, questionnaire, or acknowledgment signed by a franchisee in connection with the commencement of the franchise relationship shall waive any claims under any applicable state franchise law, including fraud in the inducement, or disclaim reliance on any statement made by the franchisor. This provision supersedes any other term of any document executed in connection with the franchise. Similarly, Indiana law prohibits a prospective general release of claims subject to the Indiana Deceptive Franchise Practices Law.

These stipulations are important for prospective Crisp & Green franchisees to understand, as they clarify the extent to which they are waiving their rights when signing a general release during a franchise transfer. Franchisees should consult with legal counsel to fully understand the implications of any release they are asked to sign and to ensure their rights are protected under applicable state laws.