Does the Stretch Zone franchise agreement preclude a franchisee from bringing an action in Washington for violations of the Washington Franchise Investment Protection Act?
Stretch_Zone Franchise · 2025 FDDAnswer from 2025 FDD Document
In addition, if litigation is not precluded by the franchise agreement, a franchisee may bring an action or proceeding arising out of or in connection with the sale of franchises, or a violation of the Washington Franchise Investment Protection Act, in Washington.
-
- General Release. A release or waiver of rights in the franchise agreement or related agreements purporting to bind the franchisee to waive compliance with any provision under the Washington Franchise Investment Protection Act or any rules or orders thereunder is void except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel, in accordance with RCW 19.100.220(2).
In addition, any such release or waiver executed in connection with a renewal or transfer of a franchise is likewise void except as provided for in RCW 19.100.220(2).
Source: Item 8 — Receipts. Any sale made must be in compliance with § 683(8) of the Franchise Sale Act (N.Y. Gen. Bus. L. § 680 et seq.), which describes the time period a Franchise Disclosure Document (offering prospectus) must be provided to a prospective franchisee before a sale may be made. New York law requires a franchisor to provide the Franchise Disclosure Document at the earliest of the first personal meeting or ten (10) business days before the execution of the franchise or other agreement or the payment of any consideration that relates to the franchise relationship. (FDD pages 99–263)
What This Means (2025 FDD)
According to the 2025 Stretch Zone Franchise Disclosure Document, the franchise agreement does not necessarily prevent a franchisee from bringing an action in Washington for violations of the Washington Franchise Investment Protection Act. Specifically, if litigation is not precluded by the franchise agreement, a franchisee may bring an action or proceeding arising out of or in connection with the sale of franchises, or a violation of the Washington Franchise Investment Protection Act, in Washington. This provision is part of the Washington Addendum to the franchise agreement, which applies if the franchise is offered or accepted in Washington, the purchaser is a Washington resident, or the franchised business operates in Washington.
Furthermore, the FDD states that any release or waiver of rights in the franchise agreement that would bind the franchisee to waive compliance with any provision under the Washington Franchise Investment Protection Act is void. The exception to this is when the release is executed pursuant to a negotiated settlement after the agreement is in effect and both parties are represented by independent counsel, in accordance with RCW 19.100.220(2). This protection extends to releases or waivers executed in connection with a renewal or transfer of a franchise, with the same exception as provided for in RCW 19.100.220(2).
These stipulations ensure that Stretch Zone franchisees in Washington retain their rights under the Washington Franchise Investment Protection Act, unless specific conditions for settlement or renewal/transfer are met with proper legal representation. This addendum modifies the franchise agreement to align with Washington state law, providing additional protections for franchisees operating within the state.