In Virginia, does the provision regarding waiving claims or disclaiming reliance supersede any other term of any document executed in connection with the Kidokinetics franchise?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
[Item 23: RECEIPT]
Section 22.4 of the Franchise Agreement is revised to state: Franchisor expressly disclaims the making of, and Franchisee acknowledges 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.
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.
Fee Deferral:
The Department of Financial Protection and Innovation requires that the Franchisor defer the collection of all initial fees from California franchisees until the Franchisor has completed all its preopening obligations and franchisee is open for business.
HAWAII
The following is added to the Cover Page:
THIS FRANCHISE WILL BE/HAS BEEN FILED UNDER THE FRANCHISE INVESTMENT LAW OF THE STATE OF HAWAII. FILING DOES NOT CONSTITUTE APPROVAL, RECOMMENDATION OR ENDORSEMENT BY THE DIRECTOR OF COMMERCE AND CONSUMER AFFAIRS OR A FINDING BY THE DIRECTOR OF COMMERCE AND CONSUMER AFFAIRS THAT THE INFORMATION PROVIDED IN THIS FRANCHISE DISCLOSURE DOCUMENT IS TRUE, COMPLETE AND NOT MISLEADING.
[Item 23: RECEIPT]
VIRGINIA
Item 17(h). The following is added to Item 17(h):
"Pursuant to Section 13.1-564 of the Virginia Retail Franchising Act, it is unlawful for a franchisor to use undue influence to induce a franchise to surrender any right given to him under the franchise. If any provision of the Franchise Agreement or Supplemental Agreements involve the use of undue influence by the Franchisor to induce a franchisee to surrender any rights given to franchisee under the Franchise, that provision may not be enforceable."
In recognition of the restrictions contained in Section 13.1-564 of the Virginia Retail Franchising Act, the FDD for Kidokinetics Franchise LLC for use in the Commonwealth of Virginia shall be amended as follows:
Additional Disclosure. The following statements are added to Item 8 and Item 17.h.
Pursuant to Section 13.1-564 of the Virginia Retail Franchising Act, it is unlawful for a franchisor to cancel a franchise without reasonable cause. If any grounds for default or termination stated in the Franchise Agreement does not constitute "reasonable cause," as that term may be defined in the Virginia Retail Franchising Act or the laws of Virginia, that provision may not be enforceable.
Source: Item 23 — RECEIPT (FDD pages 59–205)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, for franchisees in Virginia, a specific provision addresses the waiving of claims or disclaiming reliance. The FDD states that no statement, questionnaire, or acknowledgment signed by a franchisee at the start of their franchise relationship can waive claims under state franchise law, including fraud in the inducement, or disclaim reliance on statements made by Kidokinetics or its representatives. This specific provision takes precedence over any other conflicting terms in any document related to the franchise agreement.
This means that even if other documents contain clauses that seem to limit a franchisee's ability to make claims or rely on certain statements, this provision ensures those clauses are superseded. This offers a level of protection to the franchisee, ensuring they cannot inadvertently waive their rights under Virginia franchise law or disclaim reliance on representations made by Kidokinetics during the franchise sales process.
Furthermore, the Kidokinetics FDD includes an addendum specific to Virginia, highlighting Section 13.1-564 of the Virginia Retail Franchising Act. This act makes it unlawful for Kidokinetics to use undue influence to induce a franchisee to surrender any rights granted to them under the franchise agreement. If any provision in the Franchise Agreement or Supplemental Agreements involves such undue influence, that provision may not be enforceable. This reinforces the protection of franchisee rights within the state of Virginia.
In addition, the FDD states that it is unlawful for Kidokinetics to cancel a franchise in Virginia without reasonable cause. If any grounds for default or termination stated in the Franchise Agreement does not constitute "reasonable cause," as that term may be defined in the Virginia Retail Franchising Act or the laws of Virginia, that provision may not be enforceable.