Does the Hardees franchise agreement allow franchisees in California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, or Wisconsin to disclaim reliance on statements made by the franchisor or their representatives?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
I. FOR THE FOLLOWING STATES ONLY: CALIFORNIA, HAWAII, ILLINOIS, INDIANA, MARYLAND, MICHIGAN, MINNESOTA, NEW YORK, NORTH DAKOTA, RHODE ISLAND, SOUTH DAKOTA, VIRGINIA, WASHINGTON, WISCONSIN
If Franchisee is a resident of one of the states listed in the heading of this Section 32.I (the "Applicable Franchise Registration State") or a non-resident who is acquiring franchise rights permitting the location of the Franchised Restaurant in the Applicable Franchise Registration State, then the following applies:
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.
Source: Item 22 — Contracts (FDD page 85)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, the franchise agreement does not allow franchisees in California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, or Wisconsin to disclaim reliance on statements made by Hardees or its representatives. This protection is specifically provided to franchisees who are residents of these states or non-residents acquiring franchise rights for a Hardees restaurant located in these states.
This provision ensures that franchisees in these states retain their rights under applicable state franchise laws, including the ability to bring claims for fraud in the inducement. It prevents Hardees from using standardized statements or acknowledgments to circumvent these protections. The FDD explicitly states that this clause supersedes any other conflicting terms in any document related to the franchise agreement.
In practical terms, this means that if a Hardees franchisee in one of these states believes they were misled by statements made by Hardees during the franchise sales process, they are not prevented from pursuing legal action based on those misrepresentations. This protection is particularly important in states with franchise-specific laws designed to protect franchisees from potential abuses by franchisors.