For Ledgers franchises in Indiana, what is the prohibited action regarding the limitation of litigation?

According to Ledgers' 2025 Franchise Disclosure Document, Indiana Code section 23-2.2.7-1(10) prohibits the limitation of litigation. The Indiana Secretary of State has interpreted this section to prohibit provisions in contract regarding liquidated damages. This means that any clause in the Ledgers Franchise Agreement that seeks to limit a franchisee's ability to pursue litigation against Ledgers is unenforceable in Indiana.

For a prospective Ledgers franchisee in Indiana, this is a beneficial provision. It ensures that they retain their full legal rights to bring a lawsuit against Ledgers if they believe the company has acted unlawfully or breached the franchise agreement. This protection extends to disputes over liquidated damages, which are pre-determined amounts of money specified in the contract that one party must pay to the other in the event of a breach.

Furthermore, the FDD states that any provisions in the Franchise Agreement regarding liquidated damages may not be enforceable in Indiana. This means that Ledgers cannot rely on these clauses to automatically recover a specific amount of money from a franchisee who violates the agreement. Instead, Ledgers may have to prove actual damages in court, which can be a more difficult and costly process. This provides an additional layer of protection for Indiana franchisees, as it prevents Ledgers from imposing potentially unfair or excessive penalties.