Can a Kidokinetics franchisee seek damages from the franchisor's principals, affiliates, shareholders, members, directors, officers, employees, agents, and representatives?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisee further agrees that fulfillment of any and all of Franchisor's obligations written in the Franchise Agreement shall be Franchisor's sole responsibility and none of Franchisor's owners, officers, agents, representatives, nor any individuals associated with Franchisor shall be personally liable to Franchisee for any reason.
Nothing in this Franchise Agreement is intended, nor shall be deemed, to confer any rights or remedies upon any person or legal entity not a party to this Franchise Agreement; provided, however, that the additional insureds and the Indemnitees are intended third party beneficiaries under this Franchise Agreement with respect to indemnification obligations of Franchisee.
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, a franchisee cannot hold the franchisor's owners, officers, agents, representatives, or any individuals associated with Kidokinetics personally liable for the franchisor's obligations under the Franchise Agreement. The Franchise Agreement specifies that the franchisor's obligations are solely the franchisor's responsibility.
However, the agreement also states that additional insureds and indemnitees are considered third-party beneficiaries concerning the franchisee's indemnification obligations. This means that while the franchisee cannot directly sue the franchisor's related parties for the franchisor's failures, those parties are protected by the franchisee's agreement to indemnify the franchisor against certain claims and liabilities.
This clause aims to protect the individuals associated with Kidokinetics from personal liability related to the franchise agreement, shifting the responsibility to the franchisor entity itself. However, franchisees should be aware of their obligation to indemnify the franchisor and related parties, which could indirectly expose them to costs and liabilities.