When are provisions requiring Dryject franchisees to waive exemplary or punitive damages considered valid?

According to Dryject's 2025 Franchise Disclosure Document, provisions that require franchisees to waive exemplary, punitive, or similar damages are generally considered void. However, there is an exception to this rule. Such provisions become valid if they are executed as part of a negotiated settlement after the franchise agreement is already in effect. Additionally, for the waiver to be valid, both Dryject and the franchisee must be represented by independent legal counsel during the negotiation of the settlement. This exception is in accordance with RCW 19.100.220(2).

This means that Dryject cannot include a clause in the initial franchise agreement that forces a franchisee to waive their right to seek exemplary or punitive damages. Such a clause would be unenforceable. However, if a dispute arises after the franchise agreement is signed, and the parties enter into a settlement agreement to resolve that dispute, the franchisee can agree to waive their right to seek these types of damages as part of that settlement.

The requirement for independent legal counsel ensures that the franchisee is making a fully informed decision and is not being coerced into giving up important legal rights. This protects the franchisee from potential overreach by Dryject. It is a common practice in franchising to have these types of protections in place to balance the power dynamic between the franchisor and franchisee.

Prospective Dryject franchisees should be aware of this provision and understand their rights regarding exemplary and punitive damages. They should also ensure that they have independent legal counsel if they ever enter into a settlement agreement with Dryject to ensure that their interests are adequately protected.