Is Deka Lash allowed to unreasonably withhold consent to the transfer of a franchise in Minnesota?

According to the 2024 Deka Lash Franchise Disclosure Document, Minnesota law impacts the transfer of a franchise. Specifically, for franchises governed by Minnesota law, Deka Lash must comply with Minn. Stat. Sec. 80C.14 Subds. 3, 4, and 5. These statutes mandate that, except in certain specified cases, Deka Lash must provide a franchisee with 90 days' notice of termination (with 60 days to cure) and 180 days' notice for non-renewal of the franchise agreement.

More importantly, regarding franchise transfers, the Minnesota addendum explicitly states that Deka Lash's consent to the transfer of a franchise will not be unreasonably withheld. This provision protects franchisees in Minnesota from arbitrary denials of transfer requests, ensuring they can sell their business to a qualified buyer without undue interference from the franchisor.

This protection is significant because it aligns with fair franchising practices, preventing Deka Lash from hindering a franchisee's ability to realize the value of their business upon sale. However, the FDD does not define what constitutes 'unreasonable' withholding of consent, so a prospective franchisee should seek clarification from Deka Lash on the specific criteria and procedures involved in the transfer approval process to fully understand their rights and obligations.