Can disputes regarding the use of Name and Marks be resolved through arbitration for Amerispec Inspection Services?
Amerispec_Inspection_Services Franchise · 2025 FDDAnswer from 2025 FDD Document
mony, records, documents or information from any arbitration hearing to any other person or entity except as required or expressly permitted by applicable law.
21.2Exceptions to Alternative Dispute Resolution.
21.2.1 Excepted Disputes. Unless the Company consents in writing otherwise, the following Covered Disputes will not be subject to or resolved through the informal negotiation, nonbinding mediation, and binding arbitration procedures specified in Paragraph 21.1 (Alternative Dispute Resolution Procedure) and will instead be resolved through litigation: (a) disputes relating to Franchisee's use of the Name and Marks (including Lanham Act or common law claims); (b) disputes that otherwise relate to the ownership or validity of any of the Company's intellectual property or the enforcement of the Company's intellectual property rights; (c) disputes that involve protection of the Company's confidential information; (d) disputes related to the enforcement of Paragraph 15 (Covenants); and (e) disputes related to the payment of sums that any of the Franchisee Related Parties owes to any of the Franchisor Related
Parties (collectively, "Excepted Disputes").
- 21.2.2 Injunctive Relief. Notwithstanding the parties' agreement to resolve Covered Disputes through the informal negotiation, non-binding mediation, and binding arbitration procedures specified in Paragraph 21.1 (Alternative Dispute Resolution Procedure), either party will have the right to seek temporary restraining orders and temporary or preliminary injunctive relief from a court of competent jurisdiction to obtain interim relief when deemed necessary by such court to preserve the status quo or prevent irreparable injury pending resolution of the actual Covered Dispute that would otherwise be subject to arbitration; provided, however, that such party must contemporaneously submit the Covered Dispute for arbitration on the merits as provided in Paragraph 21.1.3 (Arbitration). In addition to any other relief available at law or equity, the Company will have the right to obtain restraining orders or temporary or permanent injunctions to, among other things: (a) enforce the provisions of this Agreement related to the use or protection of the Name and Marks, Franchisor's confidential information, other components of the System of Operation, or other intellectual property of any of the Company Related Parties; (b) enforce the non-compete covenants in Paragraph 15 (Covenants); (c) enforce the obligations of any Franchisee Related Party on termination or expiration of this Agreement; and (d) prohibit any act or omission by any Franchisee Related Party that is a violation of applicable law or that threatens to harm the Name and Marks, the System of Operation, or the business of other franchisees or the Company Related Parties. The Franchisee agrees that the Company Related Parties will not be required to prove actual damages or post a bond in excess of $1,000 or other security in seeking or obtaining injunctive relief (both preliminary and permanent) and/or specific performance with respect to this Agreement.
- 21.2.3 Forum for Litigation. Any litigation related to an Excepted Dispute will be filed exclusively in the state court or United States District Court for the district in which the Company has its principal place of business at the time of filing. The parties waive all questions of personal jurisdiction and venue for the purp
Source: Item 23 — Receipts (FDD pages 47–172)
What This Means (2025 FDD)
According to the 2025 FDD, disputes regarding the use of Names and Marks for Amerispec Inspection Services are explicitly excluded from resolution through informal negotiation, nonbinding mediation, and binding arbitration. Instead, these disputes must be resolved through litigation, unless Amerispec Inspection Services consents otherwise in writing. This exclusion extends to disputes relating to the ownership or validity of the company's intellectual property or the enforcement of its intellectual property rights.
This policy has significant implications for prospective Amerispec Inspection Services franchisees. If a dispute arises concerning the franchisee's use of the Names and Marks, the franchisee will likely need to engage in formal litigation rather than alternative dispute resolution methods like arbitration, which are often less costly and time-consuming. This could potentially increase the legal expenses and time commitment required to resolve such disputes.
Amerispec Inspection Services retains the right to seek temporary restraining orders and preliminary injunctive relief from a court to protect its Names and Marks, confidential information, and other intellectual property. The franchisee agrees that Amerispec Inspection Services will not be required to prove actual damages or post a bond in excess of $1,000 when seeking injunctive relief. Any litigation related to these disputes will be filed exclusively in the state court or United States District Court for the district in which Amerispec Inspection Services has its principal place of business.
This arrangement is not uncommon in franchising, as franchisors often seek to maintain tight control over their intellectual property and brand reputation. However, prospective franchisees should carefully consider the potential costs and risks associated with this provision, particularly the possibility of having to litigate disputes in a potentially distant jurisdiction.