Is the requirement for dispute resolution by litigation in Lakeville, MN for Exit Realty Upper Midwest subject to state law?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 17: RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION]
| u. | Dispute resolution by arbitration or mediation | 25 | Subject to state law, all disputes must be litigated in Lakeville, MN | | v. | Choice of forum | 25 | Subject to applicable state law, all disputes must be litigated Lakeville, MN | | w. | Choice of law | 25 | Subject to applicable state law, Minnesota |
[Item 17: RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION]
The following states have statutes which may supersede the Agreements in your relationship with EXIT including the areas of termination and renewal of your Franchise and venue for disputes and governing law: ARKANSAS [Ark. Code § 4-72-204], CALIFORNIA [Bus. & Prof. Code Sections 20000-20043], CONNECTICUT [Gen. Stat. Section 42-133e et seq.], DELAWARE [Code, tit. 6, Ch.25, Sections 2551, et seq.], HAWAII [Rev. Stat. Section 482], ILLINOIS [Rev. Stat. Chapter 815 ILCS 705/1-44], INDIANA [Stat. Section 23-2-2.7], IOWA [Code Sections 523H.1 - 523H.17], MICHIGAN [Stat. Section 445.1527(c)], MINNESOTA [Stat. Section 80C.14], MISSISSIPPI [Code Section 75-24-53], MISSOURI [Stat. Section 407.405], NEBRASKA [Rev. Stat. Section 87-404], NEW JERSEY [Stat. Section 56:10-1], RHODE ISLAND [Gen. Laws § 6- 50-4], TENNESSEE [Code Ann. § 47-25-1503], VIRGINIA [Code 13.1-557-574 - 13.1-564], WASHINGTON [Code Section 19.100.180], WISCONSIN [Stat. Section 135.03]. These and other states may have court decisions which may supersede the Agreements in your relationship with EXIT including the areas of termination and renewal of your Franchise, venue for disputes and governing laws.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 27–31)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, the requirement for dispute resolution through litigation in Lakeville, MN is subject to state law. Specifically, Item 17(u) states that dispute resolution is subject to state law. This means that while Exit Realty Upper Midwest designates Lakeville, MN as the location for litigation, state laws could potentially override this provision.
Furthermore, the FDD lists several states, including Minnesota, that have statutes which may supersede the agreements regarding venue for disputes. This indicates that the enforceability of the Lakeville, MN litigation clause may vary depending on the franchisee's location and the specific laws of that state.
Prospective Exit franchisees should consult with a legal professional to understand how their state's laws might affect the dispute resolution process and the enforceability of the forum selection clause in the franchise agreement. It is important to be aware that state laws can modify or even invalidate certain provisions of the franchise agreement, including those related to where disputes must be litigated.