Under the Pearce Bespoke franchise agreement, what specific actions are franchisees prohibited from taking regarding disparagement of the Released Parties?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
- 3. Nondisparagement. Releasor expressly covenants and agrees not to make any false representation of facts, or to defame, disparage, discredit, or deprecate any of the Released Parties or otherwise communicate with any person or entity in a manner intending to damage any of the Released Parties, their business, or their reputation.
Source: Item 23 — RECEIPTS (FDD pages 39–172)
What This Means (2025 FDD)
According to the 2025 Pearce Bespoke Franchise Disclosure Document, franchisees, referred to as the 'Releasor,' are prohibited from making any false representations of facts or defaming, disparaging, discrediting, or deprecating any of the 'Released Parties.' This extends to any communication with any person or entity with the intention of damaging the Released Parties, their business, or their reputation. The 'Released Parties' include Pearce Bespoke Franchising, LLC, its affiliates, parents, subsidiaries, officers, directors, agents, partners, employees, and attorneys.
This nondisparagement clause is part of a general release of claims that Pearce Bespoke may require franchisees to sign in certain circumstances, such as a renewal of the franchise or as a condition of approving a sale of the franchise. By agreeing to this clause, a franchisee is essentially promising not to make any negative or damaging statements about Pearce Bespoke or its related parties. This is a fairly standard practice in franchising, as franchisors want to protect their brand reputation.
The implications of this clause are that a franchisee must be very careful about what they say or write about Pearce Bespoke, even after the franchise relationship ends. Any negative statements, even if true, could potentially be seen as a breach of this agreement and could lead to legal action. Franchisees should seek legal counsel before making any statements that could be construed as disparaging.
It is important to note that this release does not apply to claims arising under the Franchise Investment Protection Act, Chapter 19.100 RCW, for Washington State franchisees. This means that franchisees in Washington State retain their rights to pursue claims under this specific law, notwithstanding the general release. Franchisees should carefully review the entire release and understand their rights and obligations before signing.