Does the Rhode Island amendment for Pearce Bespoke independently meet the jurisdictional requirements of the Rhode Island Franchise Investment Act?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
d of Item 17:
Section 19-28.1-14 of the Rhode Island Franchise Investment Act provides that "A provision in a franchise agreement restricting jurisdiction or venue to a forum outside this state or requiring the application of the laws of another state is void with respect to a claim otherwise enforceable under this Act."
- Each provision of this Addendum to the Disclosure Document shall be effective only to the extent, with respect to such provision, that the jurisdictional requirements of the Rhode Island Franchise Investment Act are met independently without reference to this Addendum to the Disclosure Document.
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AMENDMENT TO THE THE PEARCE BESPOKE FRANCHISING LLC FRANCHISE AGREEMENT REQUIRED BY THE STATE OF RHODE ISLAND
In recognition of the requirements of the Rhode Island Franchise Investment Act, the parties to the attached The Tox Franchising Group, LLC Franchise Agreement (the "Franchise Agreement") agree as follows:
1.
Source: Item 22 — CONTRACTS (FDD page 39)
What This Means (2025 FDD)
According to the 2025 Pearce Bespoke Franchise Disclosure Document, the Rhode Island addendum includes a provision addressing the jurisdictional requirements of the Rhode Island Franchise Investment Act. Specifically, each provision of the addendum is designed to be effective only if the jurisdictional requirements of the Act are met independently, without relying on the addendum itself. This applies both to the addendum to the Franchise Disclosure Document and the amendment to the Franchise Agreement.
This means that the changes made in the Rhode Island addendum, such as allowing franchisees to sue Pearce Bespoke in Rhode Island for claims under the Rhode Island Franchise Investment Act and stating that restrictions on jurisdiction or venue outside of Rhode Island are void, are only valid if the Rhode Island Franchise Investment Act already applies to the franchise relationship based on other factors. These factors could include the franchisee's location in Rhode Island, the franchise being operated in Rhode Island, or other connections to the state that would give Rhode Island jurisdiction.
For a prospective Pearce Bespoke franchisee in Rhode Island, this clause ensures that the franchisee can only rely on the protections and amendments provided in the addendum if the Rhode Island Franchise Investment Act inherently applies to their franchise agreement. It is important for franchisees to understand the conditions under which the Rhode Island Franchise Investment Act applies, independently of the addendum, to ensure they can benefit from the provisions outlined in the addendum.