Can the franchisor's business judgment be limited for Degree Wellness franchisees?

According to the 2025 Degree Wellness Franchise Disclosure Document, the franchisor's business judgment can be limited. Specifically, provisions in the franchise agreement stating that Degree Wellness may exercise its discretion based on reasonable business judgment may be limited or superseded by Washington state law (RCW 19.100.180(1)). This law requires the parties to deal with each other in good faith.

This means that while Degree Wellness retains discretion in its decision-making, it must act in good faith towards its franchisees. If a franchisee believes Degree Wellness has not acted in good faith, they may have grounds to challenge the franchisor's decisions, even if Degree Wellness claims the decision was based on business judgment. This provides a legal avenue for franchisees to dispute actions they perceive as unfair or detrimental, ensuring that Degree Wellness cannot act arbitrarily without considering the impact on its franchisees.

For a prospective Degree Wellness franchisee, this is an important protection. It ensures that the franchisor cannot make decisions solely for its own benefit without considering the franchisee's interests. However, franchisees should be aware that challenging a franchisor's business judgment can be complex and may require legal expertise to demonstrate a lack of good faith. Franchisees should consult with an attorney to fully understand their rights and options under Washington state law.