Where in The Standardx Franchise Disclosure Document is the 'Choice of law' summary section located?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
ed to the end of the "Summary" section of Item 17(w) of the Franchise Disclosure Document, titled Choice of law:
Except for Federal Arbitration Act and other federal law, to the extent required by law, North Dakota law applies.
- The following paragraph is added to the end of Item 17 of the Franchise Disclosure Document:
No statement, questionnaire, or acknowledgement signed or agreed to by you in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by us, any franchise seller, or any other person acting on our behalf. This provision supersedes any other term of any document executed in connection with the franchise.
RHODE ISLAND
- The "Summary" section of Item 17(v) of the Franchise Disclosure Document, titled Choice of forum, is deleted and replaced with the following:
Subject to arbitration obligation, litigation generally must be in our home state, except as otherwise required by applicable law with respect to claims arising under the Rhode Island Franchise Investment Act.
2.
Source: Item 18 — OTHER INCOME (LOSS), NET (FDD pages 187–399)
What This Means (2025 FDD)
According to The Standardx's 2025 Franchise Disclosure Document, the 'Choice of Law' summary section is located in Item 17(w). Specifically, the document includes additional state-specific disclosures that modify this section for franchisees in North Dakota, Maryland, and Rhode Island. These modifications outline which state's laws govern the franchise agreement, often specifying that the laws of the franchisee's state apply to claims arising under that state's franchise laws, unless preempted by federal law.
For instance, in North Dakota, Item 17(w) states that, except for the Federal Arbitration Act and other federal law, North Dakota law applies to the extent required by law. Similarly, for Maryland, the document indicates that franchisees may bring an action in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law, subject to arbitration obligations. In Rhode Island, the original 'Choice of Law' summary section in Item 17(w) is replaced, generally applying Illinois law except as required by Rhode Island franchise law.
These state-specific modifications are crucial for prospective The Standardx franchisees because they clarify which jurisdiction's laws will govern the franchise agreement and any disputes that may arise. This can significantly impact a franchisee's rights and obligations, as franchise laws vary considerably from state to state. Franchisees should carefully review these state-specific disclosures to understand their legal rights and obligations in their particular state.
It is also important to note that these provisions often include exceptions and conditions, such as the applicability of the Federal Arbitration Act and the requirement to comply with state franchise laws. Franchisees should consult with an attorney to fully understand the implications of these provisions and how they may affect their franchise agreement.