What is the effect of the Rhode Island Franchise Investment Act on the Epcon Communities Franchise Agreement?
Epcon_Communities Franchise · 2025 FDDAnswer from 2025 FDD Document
ADDENDUM TO EPCON COMMUNITIES FRANCHISING, LLC DISCLOSURE DOCUMENT FOR THE STATE OF RHODE ISLAND
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- The first chart of Item 17 (Franchise Agreement) of the disclosure document is hereby modified by adding the following to the end of the "Summary" column for item "m.":
- "Except for a release given in connection with the settlement of disputes, claims or civil lawsuits arising or brought under the Rhode Island Franchise Investment Act (the "Act"), the release described above may not relieve any person from liability imposed by the Act or any rule or order under the Act."
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- The first chart of Item 17 (Franchise Agreement) of the disclosure document is hereby modified by adding the following to the end of the "Summary" column for items "v." and "w.":
- "Provided, however, that Section 19-28.1-14 of the Rhode Island Franchise Investment Act provides that a provision in a franchise agreement restricting jurisdiction or venue to a forum outside of the State of Rhode Island or requiring the application of the laws of another state is void with respect to a claim otherwise enforceable under the Rhode Island Franchise Investment Act."
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- No statement, questionnaire, or acknowledgment signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
ADDENDUM TO EPCON COMMUNITIES FRANCHISING, LLC FRANCHISE AGREEMENT FOR THE STATE OF RHODE ISLAND
Source: Item 23 — RECEIPTS (FDD pages 86–280)
What This Means (2025 FDD)
According to the 2025 Epcon Communities FDD, the Rhode Island Franchise Investment Act has several specific effects on the standard franchise agreement within that state.
First, the addendum modifies the standard release provisions in the franchise agreement. A general release will not relieve any person from liability imposed by the Rhode Island Franchise Investment Act, except for releases connected with settling disputes, claims, or lawsuits under that Act. This ensures franchisees retain their rights under Rhode Island law, even when signing releases.
Second, the addendum addresses venue and jurisdiction. It states that any provision in the franchise agreement that restricts jurisdiction or venue to a location outside of Rhode Island, or requires the application of another state's laws, is void if it involves a claim enforceable under the Rhode Island Franchise Investment Act. This means Rhode Island franchisees can pursue claims under their state's franchise laws in Rhode Island courts, regardless of what the standard agreement says.
Finally, the addendum clarifies that no statement, questionnaire, or acknowledgment signed by a franchisee can waive claims under any applicable state franchise law, including claims of fraud. Nor can these documents disclaim reliance on statements made by Epcon Communities. This provision overrides any conflicting terms in other franchise documents, strengthening the franchisee's protections under Rhode Island law.