Does the Spray Net franchise agreement include a waiver of class actions?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
- L. WAIVER OF CLASS ACTIONS. THE PARTIES AGREE THAT ALL PROCEEDINGS ARISING OUT OF OR RELATED TO THIS AGREEMENT, OR THE SALE OF THE FRANCHISED BUSINESS, WILL BE CONDUCTED ON AN INDIVIDUAL, NOT A CLASS-WIDE BASIS, AND THAT ANY PROCEEDING BETWEEN FRANCHISEE, FRANCHISEE'S GUARANTORS AND FRANCHISOR OR ITS AFFILIATES/OFFICERS/EMPLOYEES MAY NOT BE CONSOLIDATED WITH ANY OTHER PROCEEDING BETWEEN FRANCHISOR AND ANY OTHER THIRD PARTY.
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
According to the 2025 Spray Net Franchise Disclosure Document, the franchise agreement includes a waiver of class actions. Specifically, it states that all proceedings related to the agreement or the sale of the franchised business will be conducted on an individual basis, not a class-wide basis. Additionally, any proceeding between a franchisee, their guarantors, and Spray Net cannot be consolidated with other proceedings between Spray Net and any other third party.
This means that a franchisee is giving up the right to participate in a class action lawsuit against Spray Net. Instead, they must pursue any claims individually. This could be a disadvantage to franchisees, as class action lawsuits can be a more efficient and cost-effective way to address widespread issues affecting multiple franchisees.
Class action waivers are becoming increasingly common in franchise agreements. Prospective franchisees should carefully consider the implications of this provision and consult with an attorney before signing the agreement. It is important to understand that by agreeing to this waiver, a franchisee is limiting their legal options in the event of a dispute with Spray Net.