Can a Kidokinetics franchisee disclaim reliance on any statement made by the franchisor in connection with the commencement of the franchise relationship in Hawaii?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
wledges that it has not received any warranty or guarantee, express or implied, as to the potential volume, profits or success of the business venture contemplated by this Agreement.
The FDD and Franchise Agreement are amended to state: 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 23 — RECEIPT (FDD pages 59–205)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, a franchisee in Hawaii cannot disclaim reliance on statements made by the franchisor. The FDD and Franchise Agreement explicitly state that no signed statement, questionnaire, or acknowledgment can waive claims under state franchise law, including fraud in the inducement, or disclaim reliance on statements made by the franchisor or their representatives. This provision overrides any conflicting terms in any document related to the franchise agreement. This protection ensures that franchisees in Hawaii retain their legal rights and recourse against Kidokinetics, regardless of any agreements they may sign.
This protection is significant for prospective Kidokinetics franchisees in Hawaii because it prevents the franchisor from using contractual language to shield themselves from liability for misrepresentations or fraudulent statements made during the franchise sales process. Franchisees can rely on the information provided by Kidokinetics without fear of being barred from pursuing legal action if that information proves to be false or misleading. This clause aims to create a fairer balance of power between the franchisor and franchisee.
This type of clause is not uncommon in franchise agreements, particularly in states with strong franchise protection laws. These laws are designed to protect franchisees from overreaching by franchisors and ensure that they have access to legal remedies in case of disputes. The inclusion of this provision in the Kidokinetics FDD demonstrates a commitment to complying with Hawaii's franchise laws and providing franchisees with certain legal safeguards.
Furthermore, the FDD highlights that the franchise will be filed under the Franchise Investment Law of the State of Hawaii. However, the filing does not constitute approval, recommendation, or endorsement by the Director of Commerce and Consumer Affairs, nor does it indicate that the information provided in the FDD is true, complete, and not misleading. This disclaimer emphasizes that prospective franchisees must conduct their own due diligence and not rely solely on the fact that the franchise is registered in Hawaii.