Under what conditions must a Ledgers franchisee pay attorney fees and costs?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
| Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Attorney Fees and Costs | Actual amount incurred | At time of expense | If we are the substantially prevailing party in litigation with you, or you bring a claim against an Area Representative, you agree to pay our costs and attorney fees. |
Source: Item 6 — OTHER FEES (FDD pages 17–20)
What This Means (2025 FDD)
According to Ledgers's 2025 Franchise Disclosure Document, a franchisee may be required to cover the franchisor's attorney fees and costs under specific circumstances. If Ledgers is the substantially prevailing party in litigation with the franchisee, the franchisee must pay Ledgers's legal costs. This means that if Ledgers wins a lawsuit against the franchisee, the franchisee is responsible for covering Ledgers's attorney fees and associated costs.
Additionally, the franchisee is obligated to pay Ledgers's costs and attorney fees if the franchisee brings a claim against an Area Representative of Ledgers. This condition protects Ledgers's Area Representatives from legal claims brought by franchisees, ensuring that the franchisee bears the financial responsibility for the legal defense if they pursue such a claim and incur legal costs.
The fees are based on the actual amount incurred by Ledgers and are due at the time of the expense. This arrangement is relatively standard in franchising, as it aims to protect the franchisor's interests and representatives from potentially frivolous or unsubstantiated legal actions initiated by franchisees. Prospective franchisees should carefully consider these conditions and understand the potential financial implications of litigation or claims against Area Representatives.