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The Franchise Memorandum

Michigan District Court Upholds Jury Waiver by Franchisee
Posted in Procedure

Once again, a jury trial waiver has been upheld by a federal court, this time in Michigan. In ERA Franchise Systems LLC v. Bowers Realty and Associates, Inc., 2011 U.S. Dist. LEXIS 14474 (E.D. Mich. Feb. 14, 2011), the court enforced the language of the parties’ franchise agreement. The franchisor had sued the franchisee for breach of the agreement, and Bowers’ answer included a demand for a jury. ERA moved to strike the demand, arguing that the franchise agreement’s express waiver provision controlled.  

To strike a jury waiver provision in the Sixth Circuit, the contesting party has the burden of proving that it entered into the agreement “unknowingly and involuntarily.” Bowers argued that the franchise agreement was nonnegotiable, it was not represented by counsel when entering into it, and separate compensation was not paid for the jury waiver. The court held that these allegations did not rise to the level of proving that the franchisee entered into the franchise agreement unknowingly or involuntarily. The court found instead that the franchise agreement was a negotiable contract signed after consideration by both parties and the jury waiver was, therefore, enforceable.

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The Franchise Memorandum is a collection of postings on summaries of recent legal developments of interest to franchisors brought to you by Lathrop GPM LLP. 

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