The Franchise Memorandum

A Connecticut federal court granted a franchisor’s motion to strike a jury demand in Sherman Street Associates, LLC, et al. v. JTH Tax, Inc., et al.  2010 LEXIS 29402 (D. Conn. Mar. 22, 2010).  Although the franchise agreements contained a jury waiver provision, the franchisee demanded a jury trial on its claims under the Connecticut Franchise Act and for tortious interference. 

The franchisor moved to strike the jury demand, pointing to the jury waiver provisions in the franchise agreements, which the franchisee contended were not enforceable under the CFA. 

The court found that since there was no express statutory provision prohibiting a jury trial waiver for CFA claims, the franchisee could waive its right to a trial by jury if there was evidence that it knowingly and voluntarily waived such right.  In finding for the franchisor, the court noted several factors, including the franchisee’s educational and professional background, the franchisee had signed 20 franchise agreements with jury waiver provisions, and the franchisee had the opportunity to negotiate the agreements.  The court found that the franchisee knowingly and voluntarily waived its right to a trial by jury and granted the franchisor’s motion to strike the jury demand.