In Michigan, can Kidokinetics refuse to renew a franchise on terms not generally available to other franchisees of the same class?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
Each of the following provisions is void and unenforceable if contained in any documents relating to a franchise:
- (e) A provision that permits us to refuse to renew a Franchise on terms generally available to
other franchisees of the same class or type under similar circumstances. This section does not require a renewal provision.
Source: Item 23 — RECEIPT (FDD pages 59–205)
What This Means (2024 FDD)
According to Kidokinetics' 2024 Franchise Disclosure Document, Michigan law includes provisions that protect franchisees from certain unfair practices. Specifically, the FDD states that any provision allowing Kidokinetics to refuse renewal of a franchise on terms not generally available to other franchisees of the same class is void and unenforceable.
This means that Kidokinetics cannot discriminate against a franchisee in Michigan by offering renewal terms that are less favorable than those offered to other franchisees in similar situations. This provision aims to ensure fair and equal treatment among franchisees within the Kidokinetics system in Michigan.
However, the FDD also clarifies that this section does not require Kidokinetics to offer a renewal provision at all. Therefore, while Kidokinetics must offer similar renewal terms to franchisees of the same class, they are not obligated to offer renewals in the first place. A prospective franchisee should clarify Kidokinetics's renewal policies and typical renewal terms during their due diligence.