Does the Ledgers Franchise Agreement abridge a franchisee's right to institute a civil action in Indiana?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
ALL FRANCHISE AGREEMENTS EXECUTED IN AND OPERATIVE WITHIN THE STATE OF INDIANA ARE HEREBY AMENDED AS FOLLOWS:
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- Any agreement executed in and operative within the State of Indiana shall be governed by applicable Indiana franchise laws and the right of any Franchisee to institute a civil action or initiate arbitral proceedings within the State of Indiana shall not be deemed to have been abridged in any form or manner by any provisions contained in this Agreement.
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- The Indiana Code 23-2-2.7-1 makes it unlawful for a Franchisor to terminate a franchise without good cause or to refuse to renew a franchise on bad faith, as well as providing other protections and rights to the franchisee.
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- In compliance with Indiana Code 12-2-2.7-1(9), any provisions in this Franchise Agreement relating to non-competition upon the termination or non-renewal of the Franchise Agreement shall be limited to a geographic area not greater than the Territory granted in this Franchise Agreement and shall be construed in accordance with Indiana Code 23-2-2.7-1(9).
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- Indiana Code section 23-2-2.7-1(10) prohibits the choice of an exclusive forum other than Indiana.
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to the 2025 Ledgers Franchise Disclosure Document, for franchise agreements executed and operative within Indiana, the franchisee's right to institute a civil action or initiate arbitral proceedings within the State of Indiana will not be abridged by any provisions in the agreement. This means that the standard Ledgers franchise agreement is modified to ensure that Indiana franchisees retain their legal rights to pursue civil actions or arbitration within the state, regardless of what the standard agreement might otherwise stipulate.
This protection is further reinforced by Indiana Code 23-2-2.7-1, which makes it unlawful for Ledgers to terminate a franchise without good cause or refuse renewal in bad faith, providing additional rights to the franchisee. Moreover, any provisions related to non-competition after termination or non-renewal are limited to the franchisee's granted territory and must align with Indiana Code 23-2-2.7-1(9). The Indiana Code also prohibits the choice of an exclusive forum outside of Indiana for resolving disputes.
In practical terms, this addendum ensures that Ledgers franchisees in Indiana have the ability to seek legal recourse within their own state and are protected against unfair termination or non-renewal. It also restricts the scope of non-compete clauses and prevents Ledgers from forcing franchisees into out-of-state legal battles. Prospective franchisees in Indiana should carefully review these state-specific amendments to fully understand their rights and protections under the Ledgers franchise agreement.