factual

What is the geographic limit of the Minnesota-specific provisions for Extreme Art Studio franchises?

Extreme_Art_Studio Franchise · 2024 FDD

Answer from 2024 FDD Document

nt of Attorney General Consumer Protection Division Attn: Franchise 670 Law Building 525 W. Ottawa Street Lansing, Michigan 48913

Telephone Number: (517) 373-7117

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.

MINNESOTA

Despite anything to the contrary in the Franchise Agreement, the following provisions will supersede and apply to all Franchises offered and sold in the State of Minnesota:

    1. Any provision in the Franchise Agreement which would require you to assent to a release, assignment, novation or waiver that would relieve any person from liability imposed by Minnesota Statutes, Sections 80C.01 to 80C.22 will be void to the extent that such contractual provision violates such law.
    1. Minnesota Statute Section 80C.21 and Minnesota Rule 2860.4400J prohibit the franchisor from requiring litigation to be conducted outside of Minnesota. In addition, nothing in the FDD or Franchise Agreement can abrogate or reduce any of your rights as provided for in Minnesota Statutes, Chapter 80C, or your rights to any procedure, forum, or remedies provided for by the laws of Minnesota.
    1. Minn. Rule Part 2860.4400J prohibits a franchisee from waiving his rights to a jury trial or waiving his rights to any procedure, forum, or remedies provided for by the laws of the jurisdiction, or consenting to liquidated damages, termination penalties or judgment notes. Any provision in the Franchise Agreement which would require you to waive your rights to any procedure, forum or remedies provided for by the laws of the State of Minnesota is deleted from any agreement relating to Franchises offered and sold in the State of Minnesota; provided, however, that this paragraph will not affect the obligation in the Franchise Agreement relating to arbitration.

    1. With respect to Franchises governed by Minnesota law, we will comply with Minnesota Statute Section 80C.14, Subds. 3, 4 and 5, which require, except in certain specified cases, that you be given 90 days' notice of termination (with 60 days to cure) and 180 days' notice for non-renewal of the Franchise Agreement; and that consent to the transfer of the Franchise will not be unreasonably withheld.
    1. Item 13 of the FDD is hereby amended to state that we will protect your rights under the Franchise Agreement to use the Marks, or indemnify you from any loss, costs, or expenses arising out of any third-party claim, suit or demand regarding your use of the Marks, if your use of the Marks is in compliance with the provisions of the Franchise Agreement and our System standards.
    1. Minnesota Rule 2860.4400(D) prohibits a franchisor from requiring a franchisee to assent to a general release. As a result, the FDD and the Franchise Agreement, which require you to sign a general release prior to renewing or transferring your Franchise, are hereby deleted from the Franchise Agreement, to the extent required by Minnesota law.
    1. The following language will appear as a new paragraph of the Franchise Agreement:
    • No Abrogation. Pursuant to Minnesota Statutes, Section 80C.21, nothing in the dispute resolution section of this Agreement will in any way abrogate or reduce any of your rights as provided for in Minnesota Statutes, Chapter 80.C.
    1. Minnesota Statute Section 80C.17 states that no action for a violation of Minnesota Statutes, Sections 80C.01 to 80C.22 may be commenced more than three (3) years after the cause of action accrues. To the extent that the Franchise Agreement conflicts with Minnesota law, Minnesota law will prevail.
    1. Item 6 of the FDD

Source: Item 23 — RECEIPTS (FDD pages 49–214)

What This Means (2024 FDD)

According to the 2024 Extreme Art Studio Franchise Disclosure Document, the Minnesota-specific provisions apply to all franchises offered and sold within the State of Minnesota. This means that if an individual purchases an Extreme Art Studio franchise to be operated in Minnesota, the provisions outlined in the addendum for Minnesota will supersede any conflicting terms in the standard franchise agreement. These provisions are designed to protect the franchisee's rights under Minnesota law.

Specifically, the Minnesota addendum addresses issues such as waivers of liability, choice of law and forum, jury trial waivers, and termination and renewal rights. For example, the franchise agreement cannot force a franchisee to litigate outside of Minnesota, and franchisees are entitled to specific notifications regarding termination or non-renewal, as per Minnesota Statutes. These stipulations ensure that Minnesota franchisees receive the full protection of their state's franchise laws, which may be more stringent than those in other states.

Furthermore, the addendum clarifies that certain clauses in the standard Extreme Art Studio franchise agreement are modified or deleted to comply with Minnesota law. This includes clauses related to general releases and insufficient funds fees, which are capped at $30 per occurrence as per Minnesota Statute 604.113. The document also emphasizes that no statement or questionnaire signed by the franchisee can waive claims under Minnesota franchise law or disclaim reliance on statements made by the franchisor. Therefore, prospective franchisees in Minnesota should carefully review the Minnesota addendum in conjunction with the standard franchise agreement to fully understand their rights and obligations.

Disclaimer: This information is extracted from the 2024 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.