Which state's laws do the Itan Franchise Agreement and Supplemental Agreements require to be applied?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
The Franchise Agreement and Supplemental Agreements require application of the laws of California.
This provision may not be enforceable under California law.
ILLINOIS
In recognition of the requirements of the Illinois Franchise Disclosure Act, 815 ILCS 705, the Disclosure Document and the Franchise Agreement and Supplemental Agreements are amended as follows:
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- Illinois law shall apply to and govern the Franchise Agreement and Supplemental Agreements.
INDIANA
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- The Franchise Agreement and Supplemental Agreements are amended to provide that such agreements will be construed in accordance with the laws of the State of Indiana.
RHODE ISLAND
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- Section 19-28.1-14 of the Rhode Island Franchise Law provides that "A provision in a franchise agreement restricting jurisdiction or venue to a forum outside this state or requiring the application of the laws of another state is void with respect to a claim otherwise enforceable under this Act." If a claim is enforceable under the Rhode Island Franchise Law, we will not restrict jurisdiction or venue to a forum outside the State of Rhode Island or require the application of the laws of another state.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, the Franchise Agreement and Supplemental Agreements generally require the application of California law. However, this provision may not be enforceable under California law. The FDD includes a State-Specific Addendum that modifies the Franchise Agreement and Supplemental Agreements to comply with specific state laws for franchisees in California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, and Wisconsin.
For franchisees in Illinois and Indiana, the addendum explicitly states that Illinois and Indiana law, respectively, will govern the Franchise Agreement and Supplemental Agreements. Similarly, for Rhode Island, the addendum specifies that if a claim is enforceable under the Rhode Island Franchise Law, Itan will not restrict jurisdiction or venue to a forum outside of Rhode Island or require the application of the laws of another state.
For prospective franchisees, this means that the governing law of their Franchise Agreement may vary depending on the state in which they are located. It is important to review the State-Specific Addendum, if applicable, to understand which state's laws will govern the agreement. Franchisees are encouraged to consult with legal counsel to determine the applicability of state and federal laws to the provisions of the Franchise Agreement and Supplemental Agreements.