What specific law prohibits Pearce Bespoke from requiring a release of liability?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
The Office of Attorney General for the State of Maryland requires that certain provisions contained in franchise documents be amended to be consistent with Maryland Franchise Registration and Disclosure Law, Md. Code Ann., Bus. Reg. § 14-201 et seq., and of the Rules and Regulations promulgated under the Act (collectively the "Maryland Franchise Law"). To the extent that this Disclosure Document or Franchise Agreement contains provisions that are inconsistent with the following, such provisions are hereby amended:
- No requirement that you agree to any release, assignment, novation, estoppel or waiver of liability as a condition to your purchasing a Pearce Bespoke franchise shall act as a release, estoppel or waiver of any liability under the Maryland Franchise Law.
2. Item 17 is amended to state:
- (a) Any claims arising under the Maryland Franchise Law must be brought within three (3) years after the grant of the franchise.
- (b) Any general release required by the terms and conditions of the Franchise Agreement as a condition of renewal, assignment or transfer shall not apply to any liability under the Maryland Franchise Law.
- (c) Our right to terminate you upon your bankruptcy may not be enforceable under federal bankruptcy law (11 U.S.C. §101 et. seq.).
- (d) Nothing herein shall waive your right to file a lawsuit alleging a cause of action arising under the Maryland Franchise Law in any court of competent jurisdiction in the State of Maryland.
Source: Item 22 — CONTRACTS (FDD page 39)
What This Means (2025 FDD)
According to Pearce Bespoke's 2025 Franchise Disclosure Document, the State of Maryland has specific laws in place to protect franchisees. The addendum to the Franchise Disclosure Document required by the State of Maryland indicates that the Maryland Franchise Registration and Disclosure Law, specifically Md. Code Ann., Bus. Reg. § 14-201 et seq., along with its associated Rules and Regulations, prohibits Pearce Bespoke from requiring a franchisee to agree to any release, assignment, novation, estoppel, or waiver of liability as a condition of purchasing a franchise.
This means that if a prospective Pearce Bespoke franchisee is located in Maryland, they cannot be forced to sign away their rights to hold the franchisor liable under Maryland Franchise Law as a condition of buying the franchise. This protection ensures that franchisees in Maryland retain their legal recourse against Pearce Bespoke for any violations of the Maryland Franchise Law.
Furthermore, any general release required for renewal, assignment, or transfer of the franchise agreement also cannot waive liability under the Maryland Franchise Law. This provision ensures continued protection for the franchisee throughout the duration of their agreement with Pearce Bespoke, and even during transitions such as renewal or transfer of ownership. This also means that franchisees can file a lawsuit alleging a cause of action arising under the Maryland Franchise Law in any court of competent jurisdiction in the State of Maryland.