In which states are certain franchisee acknowledgements NOT binding for The Standardx?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
The following provision applies only to franchisees and franchises that are subject to state franchise registration/disclosure laws in California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, or Wisconsin:
No statement, questionnaire, or acknowledgement signed or agreed to by Franchisee 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 Hyatt, any franchise seller, or any other person acting on behalf of Hyatt. This provision supersedes any other term of any document executed in connection with the franchise.
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, franchisee acknowledgements regarding reliance on representations and waivers of claims are not binding in certain states. Specifically, for franchisees and franchises subject to state franchise registration/disclosure laws in California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, or Wisconsin, certain acknowledgements are not binding.
This means that in these states, any statement, questionnaire, or acknowledgement signed by the franchisee at the start of the franchise relationship cannot waive claims under state franchise law, including claims related to fraud in the inducement. Additionally, franchisees in these states cannot disclaim reliance on statements made by The Standardx, its franchise sellers, or anyone acting on its behalf. This provision is designed to protect franchisees from unknowingly giving up their legal rights or being bound by disclaimers of reliance on representations made by the franchisor.
This protection supersedes any other conflicting terms in any document executed in connection with the franchise agreement. Therefore, even if a franchisee signs an agreement that appears to waive certain rights or disclaim reliance on certain representations, those provisions will not be enforceable in the specified states to the extent they conflict with the state's franchise laws. This ensures that franchisees in these states retain their rights and remedies under state franchise law, regardless of any potentially conflicting language in the franchise agreement.
Prospective franchisees of The Standardx should be aware of these state-specific provisions and understand their rights under the franchise laws of their respective states. It is advisable to consult with an attorney to fully understand the implications of these provisions and how they may affect the franchise relationship.