Does the release in the Floyds 99 Franchise Disclosure Document cover claims arising from the franchise relationship itself?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
In Items 17.c and 17.m of the Franchise Agreement, any releases you sign will not apply to any claims that may arise under the Minnesota Franchise Act.
RIDER TO THE FLOYD'S 99 FRANCHISE AGREEMENT FOR THE STATE OF MINNESOTA
This Rider to the Franchise Agreement by and between Floyd's 99 Franchising, LLC and Franchisee is dated, 20
- The following paragraph is added to Section 15.4 of the Franchise Agreement:
The Franchisor agrees to protect the Franchisee against claims of infringement or unfair competition with respect to the Franchisee's authorized use of the Marks when, in the opinion of counsel to the Franchisor, the Franchisee's rights granted therein warrant protection.
- The following sentence is added at the end of Sections 18.2.f. and 19.3.d:
Any release executed in connection herewith will not apply to any claims that may arise under the Minnesota Franchise Act.
In Items 17.c. and 17.m., any releases you sign will not apply to any claims that may arise under the Indiana Franchise Disclosure Law and the Indiana Deceptive Practices Act.
b. Pursuant to the Code of Maryland Regulations (COMAR) 02.02.08.16L, the general release required as a condition of renewal, sale and/or assignment/transfer shall not apply to any liability under the Maryland Franchise Registration and Disclosure Law.
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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.
In conformance with Section 41 of the Illinois Franchise Disclosure Act, any condition, stipulation or provision purporting to bind any person acquiring any franchise to waive compliance with the Illinois Franchise Disclosure Act or any other law of Illinois is void.
No statement, questionnaire, or acknowledgement 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.
Source: Item 23 — RECEIPT (FDD pages 58–229)
What This Means (2025 FDD)
According to the 2025 Floyds 99 Franchise Disclosure Document, the enforceability and scope of general releases signed by franchisees are limited by state laws, particularly concerning claims arising from the franchise relationship. In several states, including Minnesota, Indiana, Maryland, Virginia, and Illinois, the FDD explicitly states that releases signed by franchisees do not apply to claims arising under the state's franchise laws. This means that even if a franchisee signs a general release, they may still be able to pursue claims against Floyds 99 under these state franchise laws.
For instance, the addendum for Minnesota notes that releases will not apply to claims arising under the Minnesota Franchise Act. Similarly, in Indiana, releases will not apply to claims under the Indiana Franchise Disclosure Law and the Indiana Deceptive Practices Act. Maryland's addendum specifies that general releases required for renewal or transfer do not apply to liabilities under the Maryland Franchise Registration and Disclosure Law. These stipulations protect franchisees from unknowingly waiving their rights under specific state laws related to franchising.
Moreover, the FDD includes provisions that protect franchisees from waiving claims related to fraud or misrepresentation. For example, the addenda for Illinois, Maryland, and Virginia state that no statement or acknowledgment signed by a franchisee can waive claims of fraud in the inducement or disclaim reliance on statements made by Floyds 99. This ensures that franchisees retain the right to pursue legal action if they believe they were misled during the franchise sales process. These protections vary by state, so prospective franchisees should carefully review the addenda specific to their state and consult with legal counsel to understand their rights and obligations.
In summary, while Floyds 99 may require franchisees to sign general releases, these releases often have limitations, especially concerning claims arising from the franchise relationship itself and claims related to fraud or misrepresentation. The specific protections and limitations vary by state, so it is crucial for prospective franchisees to understand the laws in their state and seek legal advice to ensure their rights are protected.