How does the Washington Franchise Investment Protection Act affect the Face Foundrie franchise agreement?
Face_Foundrie Franchise · 2025 FDDAnswer from 2025 FDD Document
The provisions of this Addendum form an integral part of, are incorporated into, and modify the Franchise Disclosure Document, the franchise agreement, and all related agreements regardless of anything to the contrary contained therein. This Addendum applies if: (a) the offer to sell a franchise is accepted in Washington; (b) the purchaser of the franchise is a resident of Washington; and/or (c) the franchised business that is the subject of the sale is to be located or operated, wholly or partly, in Washington.
CONFLICT OF LAWS. In the event of a conflict of laws, the provisions of the Washington Franchise Investment Protection Act, chapter 19.100 RCW will prevail.
FRANCHISEE BILL OF RIGHTS. RCW 19.100.180 may supersede provisions in the franchise agreement or related agreements concerning your relationship with the franchisor, including in the areas of termination and renewal of your franchise. There may also be court decisions that supersede the franchise agreement or related agreements concerning your relationship with the franchisor. Franchise agreement provisions, including those summarized in Item 17 of the Franchise Disclosure Document, are subject to state law.
SITE OF ARBITRATION, MEDIATION, AND/OR LITIGATION. In any arbitration or mediation involving a franchise purchased in Washington, the arbitration or mediation site will be either in the state of Washington, or in a place mutually agreed upon at the time of the arbitration or mediation, or as determined by the arbitrator or mediator at the time of arbitration or mediation. In addition, if litigation is not precluded by the franchise agreement, a franchisee may bring an action or proceeding arising out of or in connection with the sale of franchises, or a violation of the Washington Franchise Investment Protection Act, in Washington.
GENERAL RELEASE. A release or waiver of rights in the franchise agreement or related agreements purporting to bind the franchisee to waive compliance with any provision under the Washington Franchise Investment Protection Act or any rules or orders thereunder is void except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel, in accordance with RCW
19.100.220(2). In addition, any such release or waiver executed in connection with a renewal or transfer of a franchise is likewise void except as provided for in RCW 19.100.220(2).
STATUTE OF LIMITATIONS AND WAIVER OF JURY TRIAL. Provisions contained in the franchise agreement or related agreements that unreasonably restrict or limit the statute of limitations period for claims under the Washington Franchise Investment Protection Act, or rights or remedies under the Act such as a right to a jury trial, may not be enforceable.
TRANSFER FEES. Transfer fees are collectable only to the extent that they reflect the franchisor's reasonable estimated or actual costs in effecting a transfer.
TERMINATION BY FRANCHISEE. The franchisee may terminate the franchise agreement under any grounds permitted under state law.
CERTAIN BUY-BACK PROVISIONS. Provisions in franchise agreements or related agreements that permit the franchisor to repurchase the franchisee's business for any reason during the term of the franchise agreement without the franchisee's consent are unlawful pursuant to RCW 19.100.180(2)(j), unless the franchise is terminated for good cause.
FAIR AND REASONABLE PRICING. Any provision in the franchise agreement or related agreements that requires the franchisee to purchase or rent any product or service for more than a fair and reasonable price is unlawful under RCW 19.100.180(2)(d).
WAIVER OF EXEMPLARY & PUNITIVE DAMAGES. RCW 19.100.190 permits franchisees to seek treble damages under certain circumstances. Accordingly, provisions contained in the franchise agreement or elsewhere requiring franchisees to waive exemplary, punitive, or similar damages are void, except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel, in accordance with RCW 19.100.220(2).
FRANCHISOR'S BUSINESS JUDGMENT. Provisions in the franchise agreement or related agreements stating that the franchisor may exercise its discretion on the basis of its reasonable business judgment may be limited or superseded by RCW 19.100.180(1), which requires the parties to deal with each other in good faith.
Source: Item 23 — RECEIPTS (FDD pages 74–257)
What This Means (2025 FDD)
According to Face Foundrie's 2025 Franchise Disclosure Document, the Washington Franchise Investment Protection Act significantly impacts franchise agreements for franchises sold or operated in Washington. An addendum to the franchise agreement specifically addresses how the Act modifies the standard agreement to comply with Washington law. These modifications cover several key areas to protect franchisees.
First, in case of conflicting laws, the Washington Franchise Investment Protection Act will take precedence over the standard franchise agreement. The Act may also supersede provisions related to the franchisee's relationship with Face Foundrie, especially concerning termination and renewal rights. Any arbitration or mediation must occur in Washington unless otherwise agreed upon, and franchisees can bring legal actions in Washington for violations of the Act. Releases or waivers of rights under the Act are void unless executed under specific conditions, such as during a negotiated settlement with independent legal representation.
Additionally, the statute of limitations for claims under the Act cannot be unreasonably restricted, and the right to a jury trial cannot be waived. Transfer fees can only reflect Face Foundrie's reasonable costs. Franchisees have the right to terminate the agreement based on grounds permitted by Washington state law. Buy-back provisions that allow Face Foundrie to repurchase the franchise without the franchisee's consent are unlawful unless the termination is for good cause. Franchisees cannot be required to purchase or rent products or services at unfair prices, and waivers of exemplary or punitive damages are void unless specific conditions are met. Finally, Face Foundrie's business judgment may be limited by the Act, which requires good faith dealings between parties.
In practical terms, these stipulations mean that Face Foundrie franchisees in Washington have stronger legal protections than might be afforded under a standard franchise agreement. They have specific rights related to termination, renewal, dispute resolution, and financial obligations, ensuring that the franchise relationship adheres to the standards set by Washington law. Prospective franchisees should carefully review the Washington addendum to fully understand their rights and protections under the Washington Franchise Investment Protection Act.