In Aira Fitness franchise arbitration, can the Franchisor consolidate proceedings with other entities?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
12.5 Limitations on Proceedings.
- (a) Franchisor and Developer agree that arbitration will be conducted on an individual basis only, and not on a joint, collective or class-wide basis, and that an arbitration proceeding between Franchisor and its Affiliates, and Developer and its shareholders, officers, directors, members, managers, employees and agents, may not be consolidated or joined with any other arbitration proceeding between Franchisor and any other person or entity.
Neither party shall commence any arbitration with a third party against the other, or join with any third party in any arbitration involving Franchisor and Developer.
Further, neither Franchisor nor Developer shall attempt to consolidate or otherwise combine in any manner, an arbitration proceeding involving Franchisor and Developer with another arbitration of any kind, nor shall Franchisor or Developer attempt to certify a class or participate as a party in a class action against the other.
- (b) The foregoing notwithstanding, in the event Developer controls, is controlled by, or is in active concert with another developer of Franchisor, or there is a guarantor of some or all of Developer's obligations to Franchisor, then the joinder of those parties to any arbitration between Franchisor and Developer shall be permitted, and in all events, the joinder of an owner, director, officer, member, manager, partner or other representative or agent of Franchisor or Developer shall be permitted.
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
According to Aira Fitness's 2025 Franchise Disclosure Document, the franchisor's ability to consolidate arbitration proceedings depends on the specific agreement in question. For disputes arising under the Development Agreement, Aira Fitness and the developer agree that arbitration will be conducted on an individual basis only, and not on a joint, collective, or class-wide basis. An arbitration proceeding between Aira Fitness and its affiliates, and the developer and its shareholders, officers, directors, members, managers, employees, and agents, may not be consolidated or joined with any other arbitration proceeding between Aira Fitness and any other person or entity.
However, there are exceptions to this rule. If the developer controls, is controlled by, or is in active concert with another developer of Aira Fitness, or if there is a guarantor of some or all of the developer's obligations to Aira Fitness, then the joinder of those parties to any arbitration between Aira Fitness and the developer is permitted. Additionally, the joinder of an owner, director, officer, member, manager, partner, or other representative or agent of Aira Fitness or the developer is also permitted.
For disputes arising under the Franchise Agreement, any arbitration must be on an individual basis, and not as part of a consolidated, common, or class action, and the franchisee waives 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. If a court or arbitrator determines that this exclusion of multiparty arbitration (including class arbitration) is unenforceable, then the entire commitment to arbitrate will be null and void and the parties must submit all claims to the jurisdiction of the courts.