Does the Mrcool franchise agreement allow a franchisee to disclaim reliance on statements made by the franchisor or franchise seller?
Mrcool Franchise · 2025 FDDAnswer from 2025 FDD Document
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- 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 the 2025 Mrcool FDD, the franchise agreement includes provisions that prevent a franchisee from disclaiming reliance on statements made by Mrcool or anyone acting on its behalf. Specifically, amendments for California, Hawaii, Maryland, and New York state that no statement, questionnaire, or acknowledgement signed by a franchisee can waive claims under applicable state franchise law, including fraud in the inducement, or disclaim reliance on statements made by the franchisor, franchise seller, or anyone acting for the franchisor. These provisions override any other conflicting terms in any document related to the franchise agreement. This protection is only effective if the jurisdictional requirements of the respective state's franchise law are independently met.
For a prospective Mrcool franchisee, this means that they cannot sign away their right to hold Mrcool accountable for representations made during the franchise sales process. This is particularly important in states with franchise-specific laws like California, Hawaii, Maryland, and New York, as it ensures franchisees retain legal recourse if they believe they were misled. The FDD emphasizes that these protections are in place to prevent franchisees from unknowingly or unintentionally relinquishing their rights under state franchise laws.
However, it's important to note that these protections are contingent on meeting the jurisdictional requirements of each state's franchise law. This means that the franchisee's location, domicile, and where the outlet will operate can affect whether these provisions apply. Mrcool is also required to furnish a New York prospectus to every prospective franchisee who is protected under the New York General Business Law, Article 33.
Furthermore, the Mrcool franchise agreement includes a clause stating that the agreement, along with its schedules and exhibits, constitutes the entire agreement between Mrcool and the franchisee, superseding all prior related agreements. However, this does not disclaim any express representations made by Mrcool in the Franchise Disclosure Document disclosed to the franchisee. This clause reinforces that the franchisee can rely on the information provided in the FDD itself.