In connection with starting a Mrcool franchise, can a franchisee waive claims under applicable state franchise law?
Mrcool Franchise · 2025 FDDAnswer from 2025 FDD Document
No statement, questionnaire or acknowledgement signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of: (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
Source: Item 23 — RECEIPTS (FDD pages 55–263)
What This Means (2025 FDD)
According to Mrcool's 2025 Franchise Disclosure Document, a franchisee's ability to waive claims under applicable state franchise law is restricted. For franchisees in California, Maryland, Minnesota, New York, Virginia, North Dakota, and Washington, no statement, questionnaire, or acknowledgement signed in connection with starting the franchise can waive claims under state franchise law, including claims of fraud. This protection extends to disclaiming reliance on statements made by Mrcool or its representatives. This provision overrides any conflicting terms in any document executed during the franchise agreement.
Specifically, the Michigan FDD Amendment states that franchisees cannot be required to assent to a release, assignment, novation, waiver, or estoppel that deprives them of rights and protections provided in the Michigan Franchise Investment Law. However, after entering into a Franchise Agreement, franchisees are not precluded from settling any and all claims.
For franchisees in Washington, a release or waiver of rights is only valid if executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel. Provisions that unreasonably restrict the statute of limitations or rights to a jury trial may not be enforceable. In Rhode Island, any general release as a condition of renewal, termination, or transfer will be void with respect to claims under the Rhode Island Franchise Investment Act.
These stipulations ensure that franchisees retain their rights and protections under state laws, preventing Mrcool from enforcing waivers that could disadvantage them. Prospective franchisees should carefully review the specific state amendments in the FDD to understand their rights and limitations regarding waivers and releases.