For Mr. Sandless franchisees in Illinois, is a franchise agreement provision designating jurisdiction outside of Illinois valid?

According to Mr. Sandless's 2025 Franchise Disclosure Document, Illinois law governs the franchise agreements for franchisees operating in Illinois. Specifically, any provision within the Mr. Sandless franchise agreement that designates jurisdiction or venue in a forum outside of Illinois is considered void under Section 4 of the Illinois Franchise Disclosure Act. This means that if a Mr. Sandless franchisee in Illinois were to bring a legal claim against the franchisor, they generally could not be forced to litigate the case in another state.

However, there is an important exception to this rule. The FDD states that a Mr. Sandless franchise agreement may still include a provision that requires arbitration to take place outside of Illinois. Arbitration is a form of alternative dispute resolution where a neutral third party hears both sides of a dispute and makes a binding decision. So, while a franchisee cannot be forced to litigate a case out of state, they may be required to participate in arbitration proceedings in another state.

In practical terms, this means that a prospective Mr. Sandless franchisee in Illinois should carefully review the franchise agreement to understand the dispute resolution process. While they are protected from being forced to litigate outside of Illinois, they may still be required to arbitrate disputes in another state. Franchisees should seek legal counsel to fully understand their rights and obligations under Illinois law and the franchise agreement.