For Afuri Ramen Dumpling, what is the effect of a decision made by the arbitrator?

According to Afuri Ramen Dumpling's 2024 Franchise Disclosure Document, the prevailing party in any arbitration will be able to recover costs and reasonable attorneys' fees. These costs and fees will be determined by the arbitrator. This includes costs and attorney's fees on appeal or review from the arbitration. The prevailing party is defined as the party who recovers the greater relief in the proceeding.

This means that if an Afuri Ramen Dumpling franchisee and franchisor end up in an arbitration dispute, the party that wins the most favorable outcome will have their legal costs covered by the losing party. This could include not only the direct costs of the arbitration itself, but also any subsequent appeals or reviews. This clause aims to ensure that both parties have an incentive to resolve disputes fairly and efficiently, as the risk of having to pay the other side's legal fees could be a significant deterrent.

For a prospective Afuri Ramen Dumpling franchisee, this is an important consideration. While it's beneficial to know that you could recover legal costs if you prevail in a dispute, it also means you could be responsible for the franchisor's costs if you lose. Franchisees should carefully consider this when deciding whether to pursue arbitration and should weigh the potential benefits against the risks of incurring substantial legal expenses. It is also important to understand what constitutes "prevailing" in a legal context, as it may not always be a clear-cut determination.