In Michigan, can Mrcool require franchisees to conduct litigation outside of Michigan?
Mrcool Franchise · 2025 FDDAnswer from 2025 FDD Document
Michigan FDD Amendment
Amendments to the MRCOOL Franchise Disclosure Document
THE STATE OF MICHIGAN PROHIBITS CERTAIN UNFAIR PROVISIONS THAT ARE SOMETIMES IN FRANCHISE DOCUMENTS.
IF ANY OF THE FOLLOWING PROVISIONS ARE IN THESE FRANCHISE DOCUMENTS, THE PROVISIONS ARE VOID AND CANNOT BE ENFORCED AGAINST YOU.
- A.
A prohibition of your right to join an association of Franchisees.
- B.
A requirement that you assent to a release, assignment, novation, waiver or estoppel that deprives you of rights and protections provided in this act.
This shall not preclude you, after entering into a Franchise Agreement, from settling any and all claims.
- C.
A provision that permits us to terminate a franchise before the expiration of this term except for good cause.
Source: Item 23 — RECEIPTS (FDD pages 55–263)
What This Means (2025 FDD)
According to Mrcool's 2025 Franchise Disclosure Document, the Michigan FDD Amendment states that the State of Michigan prohibits certain unfair provisions that are sometimes in franchise documents. Specifically, if the franchise documents contain a provision that designates jurisdiction or venue outside of Michigan, such provisions are void and cannot be enforced against the franchisee. This means Mrcool cannot force a Michigan franchisee into out-of-state litigation.
This amendment protects Michigan Mrcool franchisees from having to bear the additional costs and burdens associated with litigating disputes in a potentially distant and unfamiliar legal environment. It ensures that legal proceedings can occur within the state, where the franchisee is likely to have better access to legal counsel, witnesses, and other resources.
However, this protection is not absolute. The amendment does not prevent a Mrcool franchisee from voluntarily agreeing to litigate outside of Michigan after a dispute arises. It solely restricts Mrcool's ability to mandate out-of-state litigation through the initial franchise agreement. Franchisees should carefully review the franchise agreement and any amendments to fully understand their rights and obligations under Michigan law.