factual

Does the Dog Haus franchise agreement prevent franchisees from participating in class action lawsuits against the franchisor?

Dog_Haus Franchise · 2025 FDD

Answer from 2025 FDD Document

t to, or claim for, punitive or exemplary damages against the other and agree that, in the event of a dispute between them, Franchisor and Franchisee shall each be limited to recovering only the actual damages proven to have been sustained by that Party, except as provided in Section 19.5.

  • 19.4 Specific Performance. Franchisor and Franchisee acknowledge that each Party would be irreparably damaged if the provisions of this Agreement were not capable of being specifically enforced, and for this reason, Franchisor and Franchisee agree that the provisions of this Agreement shall be specifically enforceable. Franchisor and Franchisee further agree that any act or failure to act which does not strictly comply with the provisions and conditions of this Agreement may be specifically restrained, and that the equitable relief provided for in this Agreement shall not in any way limit or deny any other remedy at law or in equity that either Franchisor or Franchisee might otherwise have.
  • 19.5 Injunctive Relief. Franchisee acknowledges and agrees that irreparable harm could be caused to Franchisor by Franchisee's violation of certain provisions of this Agreement and, as such, in addition to any other relief available at law or equity, Franchisor shall be entitled to obtain in any court of competent jurisdiction, without bond, restraining orders or temporary or permanent injunctions in order to enforce, among other items, the provisions of this Agreement relating to: (i) Franchisee's use of the Dog Haus Marks and Confidential Information (including any proprietary software used in connection with the Franchised Restaurant); (ii) the interm covenant not to compete, as well as any other violations of the restrictive covenants set forth in this Agreement; (iii) Franchisee's obligations on termination or expiration of this Agreement; (iv) disputes and controversies based on or arising under the Lanham Act, or otherwise involving the Dog Haus Marks, as now or hereafter amended; (v) disputes and controversies involving enforcement of the Franchisor's rights with respect to confidentiality under this Agreement; and (vi) prohibit any act or omission by Franchisee or its employees that constitutes a violation of Applicable Law, threatens Franchisor's franchise system or threatens other franchisees of Franchisor. Franchisee's only remedy if such an injunction is entered will be the dissolution of the injunction, if appropriate, and Franchisee waives all damage claims if the injunction is wrongfully issued.
  • 19.6 Exclusive Remedy. In no event shall either Party make or have any claim for money damages based on any claim or assertion that the other Party has unreasonably withheld, conditioned or delayed any consent, approval or authorization required under this Agreement. Each Party waives any claim for damages. Neither Party may claim any damages by way of setoff, counterclaim or defense. Each Party's sole remedy for such a claim shall be an action or proceeding to enforce the provisions of this Agreement, for specific performance or for declaratory judgment.
  • 19.7 Attorneys' Fees. In any legal action or proceeding brought to enforce any provision of this Agreement or arising out of, or in connection with, this Agreement, the prevailing Party shall be entitled to recover from the

other Party its reasonable attorneys' fees and costs in addition to any other relief that may be awarded by a court of competent jurisdiction.

  • 19.8 No Withholding of Payments.

Source: Item 22 — CONTRACTS (FDD page 87)

What This Means (2025 FDD)

Based on the 2025 Dog Haus Franchise Disclosure Document, the document does not explicitly state that franchisees are prohibited from participating in class action lawsuits against the franchisor. However, the franchise agreement includes clauses that address dispute resolution, waivers of certain types of damages, and limitations on remedies, which could potentially impact a franchisee's ability to participate in or pursue a class action lawsuit.

Specifically, the Dog Haus franchise agreement includes provisions regarding injunctive relief, where the franchisee's remedy is limited to the dissolution of an injunction and waiving damage claims if the injunction is wrongfully issued. Additionally, the agreement states that neither party can claim damages through setoff, counterclaim, or defense, with each party's sole remedy being an action to enforce the agreement, seek specific performance, or obtain a declaratory judgment. These clauses may limit the avenues available to a franchisee seeking redress from Dog Haus.

Furthermore, the franchise agreement includes a waiver of punitive damages, limiting recovery to actual damages. This waiver applies to both Dog Haus and the franchisee, with certain exceptions for the franchisee, such as breaches of non-compete or confidentiality obligations, misuse of Dog Haus Marks, fraud, willful misconduct, or illegal conduct. While this clause doesn't directly prohibit class action lawsuits, it restricts the type of damages a franchisee can seek, which could affect the viability of such a lawsuit.

Prospective Dog Haus franchisees should carefully review the dispute resolution and liability limitation clauses within the franchise agreement with legal counsel to fully understand their rights and obligations, and the potential impact on their ability to pursue collective legal action against Dog Haus.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.