Does the All States M.E.D. franchise agreement require mediation or arbitration for claims against the franchisor?
All_States_M_E_D Franchise · 2024 FDDAnswer from 2024 FDD Document
| u. Dispute Resolution by Arbitration or Mediation | FA: Section 23.9; Schedules 2 and 3 | You must mediate and arbitrate claims against us (subject to applicable state law). |
|---|---|---|
| v. Choice of Forum | FA: Section 23.2; Schedules 2 and 3 | Any mediation, litigation or arbitration must be pursued where our headquarters are located (subject to applicable state law). |
| w. Choice of Law | FA: Section 23.1; Schedules 2 and 3 | Except as to claims governed by federal law, the law of the state where we are headquartered applies (subject to applicable state law). |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 32–39)
What This Means (2024 FDD)
According to All States M.E.D.'s 2024 Franchise Disclosure Document, the franchise agreement mandates that franchisees must mediate and arbitrate claims against All States M.E.D., although this is subject to applicable state law. This means that if a franchisee has a dispute with All States M.E.D., they are required to first attempt to resolve it through mediation, and if that fails, through arbitration, instead of directly pursuing litigation in court. This requirement is found in Section 23.9 of the Franchise Agreement and Schedules 2 and 3.
Furthermore, any mediation, litigation, or arbitration must be pursued where All States M.E.D.'s headquarters are located, also subject to applicable state law. This dictates the venue for dispute resolution, potentially requiring franchisees to travel to All States M.E.D.'s headquarters for these proceedings. The choice of law, except for claims governed by federal law, is the law of the state where All States M.E.D. is headquartered, as detailed in Section 23.1 and Schedules 2 and 3 of the Franchise Agreement.
This dispute resolution process is common in franchising, as it is generally designed to be a more efficient and cost-effective way to resolve conflicts compared to traditional litigation. However, franchisees should be aware of the implications of mandatory mediation and arbitration, including the potential limitations on their legal rights and the costs associated with these processes. It is important to consult with a legal professional to fully understand the dispute resolution terms in the All States M.E.D. franchise agreement and how they apply in the franchisee's specific state.