Does the provision regarding compulsory counterclaims in All Team arbitration proceedings remain in effect after the transfer, termination, or expiration of the agreement?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
The arbitrator will apply the provisions of any applicable statute of limitations. In connection with any arbitration proceeding, ATFC and USER will submit or file any claim which would constitute a compulsory counterclaim (as defined by Rule 13 of the Federal Rules of Civil Procedure) within the same proceeding as the claim to which it relates. Any of these compulsory claims which are not submitted or filed in the same proceeding in which they relate will be barred. This provision will continue in full force and effect subsequent to and notwithstanding the Transfer, or the termination or expiration of the term of this Agreement. The arbitration will be conducted on an individual, not a class-wide basis. None of the parties to the arbitration will be entitled to consolidation of the arbitration proceedings with the proceedings of any third party, nor will the arbitrator or any court be empowered to order a consolidation of proceedings with any third party.
Source: Item 23 — RECEIPT (FDD pages 34–161)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, the requirement to submit compulsory counterclaims in arbitration proceedings remains in effect even after the transfer, termination, or expiration of the franchise agreement. This means that if a dispute arises that leads to arbitration, both All Team and the franchisee (referred to as USER in the document) must present any claims that qualify as compulsory counterclaims, as defined by Rule 13 of the Federal Rules of Civil Procedure, within the same arbitration proceeding.
If either party fails to submit a compulsory counterclaim in the initial arbitration, they will be barred from raising that claim in any future proceeding. This provision ensures that all related issues are resolved in a single arbitration, promoting efficiency and preventing piecemeal litigation. The arbitration will be conducted on an individual basis, not as a class action, and consolidation with other proceedings is not allowed.
For a prospective All Team franchisee, this means understanding the importance of identifying and presenting all potential counterclaims during any arbitration process. Failing to do so could result in losing the right to pursue those claims later. This clause is designed to streamline dispute resolution and ensure that all related issues are addressed comprehensively in a single proceeding, which can save time and resources for both parties in the long run.