In the event of a conflict of laws, which law prevails for Itan franchises as required by the Maryland Franchise Registration and Disclosure Law?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
In recognition of the requirements of the Maryland Franchise Registration and Disclosure Law (the "Maryland Franchise Law"), the Disclosure Document is amended as follows:
-
- Item 17 of the Disclosure Document is amended to add the following:
- a. The general release required as a condition of renewal, sale and/or assignment/transfer shall not apply any liability under the Maryland Franchise Registration and Disclosure Law.
- b. A franchisee may bring a lawsuit in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law.
- c. Any claims arising under the Maryland Franchise Registration and Disclosure Law must be brought within 3 years after the grant of the franchise.
- d. In the event of a conflict of laws to the extent required by the Maryland Franchise Registration and Disclosure Law, Maryland law shall prevail.
- e. The Franchise Agreement and Supplemental Agreements provide for termination upon bankruptcy. This provision may not be enforceable under federal bankruptcy law (11 U.S.C. Section 101, et seq.).
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, in the event of a conflict of laws, Maryland law will prevail to the extent required by the Maryland Franchise Registration and Disclosure Law. This amendment ensures that the rights and protections provided to franchisees under Maryland law are upheld, even if other provisions in the franchise agreement might suggest otherwise. This is a standard practice to comply with state franchise laws.
This provision means that if there is ever a disagreement about which state's laws should apply to a particular issue, and Maryland's franchise laws are involved, then Maryland law will take precedence. This is particularly important for Itan franchisees operating in Maryland, as it ensures that they receive the full protection of Maryland's franchise regulations.
For a prospective Itan franchisee in Maryland, this is a beneficial clause. It reinforces that the franchisee's rights under Maryland law cannot be undermined by conflicting terms in the franchise agreement. Franchisees should be aware of the specific protections afforded to them by Maryland law and consult with an attorney if they believe their rights are being violated.