What state's laws govern the Floyds 99 agreement, excluding federal law?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
Both parties waive any objection to the jurisdiction of these courts or to venue in the state and federal courts of Colorado.
Notwithstanding the foregoing, if the laws of the state where the Associate resides prohibit the aforesaid designation of jurisdiction and venue, then such other state's laws shall control.
Source: Item 23 — RECEIPT (FDD pages 58–229)
What This Means (2025 FDD)
According to the 2025 Floyds 99 Franchise Disclosure Document, the franchise agreement is generally governed by Colorado law. Specifically, both Floyds 99 and the franchisee agree to the jurisdiction and venue of Colorado's state and federal courts. This means that if there's a dispute, it would typically be resolved in Colorado courts, and Colorado law would be applied.
However, there's an important exception: if the franchisee resides in a state where designating Colorado jurisdiction and venue is prohibited by law, then the laws of the franchisee's state will take precedence. This ensures that franchisees are not forced to litigate in a distant or inconvenient jurisdiction if their home state's laws protect them. This is a fairly common provision in franchise agreements, as many states have franchise-specific laws designed to protect franchisees.
Furthermore, the FDD includes addenda for several states (California, New York, Indiana, Maryland, North Dakota, Rhode Island, Virginia, and Washington) that modify the franchise agreement to comply with specific state laws. For example, the New York addendum specifies that the choice of law does not waive any rights conferred upon the franchisee by the New York State General Business Law. Similarly, the North Dakota addendum notes that certain provisions, such as those requiring consent to out-of-state jurisdiction or application of other states' laws, may be unenforceable under North Dakota law. These addenda highlight the importance of reviewing the specific state addendum applicable to your location, as it may alter the governing law or enforceability of certain provisions in the franchise agreement.
For prospective Floyds 99 franchisees, it's crucial to understand which state's laws will govern the agreement, as this can significantly impact their rights and obligations. They should carefully review the franchise agreement and any applicable state addenda, and consult with an attorney to ensure they understand the implications of the choice of law provision.