AFC Franchising LLC v. Fabbro, 2:18-cv-00743

Fabbro operated an urgent-care clinic under a franchise agreement that required use of the franchisor’s Marks and allowed the franchisor to order name/mark changes.
The franchise (originally Doctors Express) was later acquired by AFC Franchising, which directed franchisees to rebrand to AFC/American Family Care; Fabbro refused.
The franchise agreement contains a Maryland choice-of-law clause and a contractual limitations clause requiring claims be brought within the earlier of (A) the applicable statutory period, (B) one year from discovery, or (C) two years from the first act or omission.
AFC sent default notices (last amended Feb. 22, 2017), later withdrew a default notice, and filed suit on May 15, 2018 seeking specific performance and declaratory relief.
Fabbro moved to dismiss as time-barred under the contract’s one-year discovery limitation; AFC argued Alabama law voids contractual shortening of the statute of limitations and thus its suit is timely under Alabama’s six-year contract statute.
The central legal dispute was choice-of-law: whether Maryland law (enforcing contractual shortened limitations) or Alabama law (Ala. Code § 6-2-15, voiding such clauses) governs enforcement of the contract’s limitations clause.

Issue	Plaintiff's Argument (AFC)	Defendant's Argument (Fabbro)	Held
Enforceability of the contract’s shortened limitations period	The contract’s limitations clause is void under Alabama law §6-2-15, so the six-year Alabama statute applies and AFC’s suit is timely.	The agreement selects Maryland law, which enforces reasonable contractual shortening clauses, so the one-year discovery period bars AFC’s suit.	Court held the contract limitation is void under Alabama law; AFC’s suit is timely.
Choice-of-law classification (procedural vs. substantive) determining which state law governs	Statutes of limitations and clauses affecting remedies are procedural; forum (Alabama) procedural law governs, so Alabama’s rule invalidating the clause applies.	Alabama’s rule voiding the clause is substantive (goes to contract validity), so the contractual choice-of-law (Maryland) should control.	Court, bound by Alabama precedent (Galliher), treated limitations/shortening clauses as procedural; forum law (Alabama) governs.

Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487 (choice-of-law in diversity cases: apply forum state’s choice-of-law rules)
Galliher v. State Mut. Life Ins. Co., 150 Ala. 543 (Alabama treats contractual shortening of limitation periods as affecting remedy/procedure; forum law controls)
Ceccone v. Carroll Home Servs., LLC, 454 Md. 680 (Maryland permits parties to shorten limitations by contract if reasonable and not otherwise barred)
Precision Gear Co. v. Cont'l Motors, Inc., 135 So. 3d 953 (Alabama generally treats statutes of limitations as procedural)
Colonial Life & Accident Ins. Co. v. Hartford Fire Ins. Co., 358 F.3d 1306 (place-of-contract law governs validity/interpretation of contracts in choice-of-law context)
Simmons Foods, Inc. v. Indus. Risk Insurers, 863 F.3d 792 (federal court should follow state supreme court precedent on classification issues)