Does the Aira Fitness franchise agreement allow for class-wide arbitration proceedings?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
A. Arbitration; Mediation. Except as qualified below, any dispute between you and us and any of our or your affiliates, officers, directors, shareholders, members, guarantors, employees or owners arising under, out of, in connection with or in relation to this Agreement, any lease for the Aira Fitness Business or Authorized Location, the parties' relationship, the Aira Fitness Business, our Standards, or the scope or validity of the arbitration obligations under this Section must be submitted to binding arbitration under the authority of the Federal Arbitration Act and must be arbitrated in accordance with the then-current rules and procedures and under the auspices of the American Arbitration Association ("AAA"). Any arbitration must be on an individual basis, and not as part of a consolidated, common, or class action, and you and/or your Owners waive any right to proceed on a consolidated, common, or class basis. Multiparty arbitration is specifically excluded, and the parties and the arbitrator will have no authority or power to proceed with any claim as a class action or otherwise to join or consolidate any claim with any claim or other proceeding involving third parties. In the event a court or arbitrator determines that this exclusion of multiparty arbitration (including class arbitration) is unenforceable, then this entire commitment to arbitrate will be null and void and the parties must submit all claims to the jurisdiction of the courts. Arbitration shall take place in the Chicago, Illinois metropolitan area. The arbitrators must follow the law and not disregard the terms of this Agreement. Any arbitrator must have at least five years' experience in franchising or in franchise law.
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
According to Aira Fitness's 2025 Franchise Disclosure Document, the franchise agreement explicitly prohibits class-wide arbitration proceedings. The document states that any arbitration must be conducted on an individual basis, explicitly excluding consolidated, common, or class actions. Franchisees and their owners waive any right to participate in such collective actions.
This means that if a dispute arises between Aira Fitness and a franchisee, the franchisee must pursue arbitration individually and cannot join forces with other franchisees to file a class action claim. This limitation is reinforced by stating that multiparty arbitration is specifically excluded, and the arbitrator lacks the authority to certify a class or consolidate actions.
The FDD also specifies that if a court or arbitrator deems the exclusion of multiparty arbitration unenforceable, the entire arbitration agreement becomes null and void, requiring the parties to resolve their claims through the court system. This provision underscores Aira Fitness's intent to avoid class action lawsuits and maintain control over dispute resolution processes, potentially saving the company from large-scale legal actions involving multiple franchisees.