In which states are certain franchisee acknowledgements NOT binding for The Standardx franchise agreement?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
The following provision applies only to franchisees and franchises that are subject to the 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 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.
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, in certain states, franchisee acknowledgements regarding waivers or disclaimers of reliance are not binding. 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, any statement, questionnaire, or acknowledgement signed in connection with the franchise relationship cannot waive claims under applicable state franchise law, including fraud in the inducement, or disclaim reliance on statements made by The Standardx or its representatives. This provision overrides any conflicting terms in other documents.
This means that even if a franchisee signs a document that appears to waive certain rights or disclaims reliance on information provided by The Standardx, those waivers or disclaimers will not be enforced in the listed states to the extent they conflict with state franchise laws. This offers franchisees in these states additional protection against potentially misleading or fraudulent practices by the franchisor.
For a prospective The Standardx franchisee, this is a significant safeguard. It ensures that franchisees in the specified states retain their legal rights and recourse, even if they have signed documents that seem to limit those rights. It is important for franchisees to be aware of this provision and to understand their rights under the franchise laws of their specific state. Franchisees should consult with an attorney to fully understand their rights and obligations under the franchise agreement and applicable state laws.