For Ledgers franchises in Indiana, what is the prohibited action regarding the limitation of litigation as interpreted by the Indiana Secretary of State?

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 to mean that provisions in contracts regarding liquidated damages are not allowed. This means that any clause in the Ledgers Franchise Agreement that stipulates predetermined amounts to be paid as damages may not be enforceable in Indiana.

For a prospective Ledgers franchisee in Indiana, this is a beneficial protection. It prevents Ledgers from enforcing a liquidated damages clause, which could potentially be unfavorable to the franchisee. Instead, any damages would need to be assessed and proven through litigation, potentially leading to a fairer outcome.

It is important for potential franchisees to understand that while the clause may not be enforceable, it does not prevent Ledgers from seeking damages. It simply means the amount of damages must be determined through a legal process rather than a pre-agreed amount. Franchisees should consult with an attorney to fully understand their rights and obligations under Indiana law.