Where will binding arbitration occur for Alloy franchise disputes, and who bears the costs?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
-
- The franchise agreement requires binding arbitration. The arbitration will occur at Indianapolis, Indiana with the costs being borne by the non-prevailing party. You are encouraged
-
- Site of Arbitration, Mediation, and/or Litigation. In any arbitration or mediation involving a franchise purchased in Washington, the arbitration or mediation site will be either in the state of Washington, or in a place mutually agreed upon at the time of the arbitration or mediation, or as determined by the arbitrator or mediator at the time of arbitration or mediation.
The arbitration must take place in the county where our headquarters are then located (currently, Roswell, Georgia, or such other place as we mutually agree.
Source: Item 23 — RECEIPTS (FDD pages 69–245)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, the location of arbitration depends on where the franchise is purchased and whether the franchise agreement is subject to California or Washington law. For franchises not subject to California or Washington law, arbitration must occur in the county where Alloy's headquarters are located, which is currently Roswell, Georgia, or another location mutually agreed upon.
However, for franchisees in California, the arbitration will occur in Indianapolis, Indiana, and the non-prevailing party bears the costs. This provision may not be enforceable under California law.
For franchisees in Washington, the arbitration site will be in Washington, or in a place mutually agreed upon at the time of the arbitration or mediation, or as determined by the arbitrator or mediator at the time of arbitration or mediation. This is due to the Washington Franchise Investment Protection Act. Prospective franchisees should carefully review the specific addenda and legal considerations based on their location to understand their rights and obligations regarding arbitration.