Subject to state law, where must all claims be arbitrated or litigated for Amerispec Inspection Services?
Amerispec_Inspection_Services Franchise · 2025 FDDAnswer from 2025 FDD Document
TCB AMERISPEC, LLC
ADDENDUM TO FRANCHISE DISCLOSURE DOCUMENT FOR THE STATE OF NORTH DAKOTA
The following information applies to franchises and Franchisees subject to North Dakota statutes and regulations. Item numbers correspond to those in the main body.
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- Item 17. Item 17 is amended to read as follows:
- A. Any provision of the Franchise Agreement requiring the Franchisee to sign a release in a format designated by AmeriSpec is unenforceable.
- B. The prevailing party in any enforcement action is entitled to recover all costs and expenses including attorneys' fees.
- C. Any provision of the Franchise Agreement requiring you to consent to waiver of exemplary and punitive damages is unenforceable under Section 51-19-09 of the North Dakota Franchise Investment Law.
- D. Any provision of the Franchise Agreement requiring you to consent to liquidated damages is hereby made null and void pursuant to Section 51-19-09 of the North Dakota Franchise Investment Law.
- E. Arbitration and mediation proceedings will be conducted at a site agreeable to all parties.
- F. The venue of any litigation arising out of the franchise relationship between you and AmeriSpec will be within the state of North Dakota.
- G. The North Dakota Securities Commissioner has held that requiring franchisees to consent to waiver of a trial by jury unfair, unjust or inequitable within the intent of Section 51-19-09 of the North Dakota Franchise Investment Law.
- H. Notwithstanding anything in the Disclosure Document, covenants not to compete may be subject to Section 9-08-06 of the North Dakota Century Code and unenforceable in the state of North Dakota if contrary to Section 9-08-06.
Source: Item 17 — Renewal, Termination, Transfer and Dispute Resolution. (FDD pages 36–39)
What This Means (2025 FDD)
According to the 2025 Amerispec Inspection Services FDD, the standard procedure involves informal negotiation, non-binding mediation, and binding arbitration to resolve disputes. However, there are exceptions where litigation is required. These exceptions include disputes relating to the use of the brand's name and marks, intellectual property ownership or rights enforcement, protection of confidential information, enforcement of non-compete covenants, and the payment of sums owed to the franchisor.
Amerispec Inspection Services retains the right to seek temporary restraining orders and preliminary injunctive relief from a competent court to prevent irreparable injury while the dispute is being resolved through arbitration. They can also pursue restraining orders or injunctions to enforce provisions related to the brand's name and marks, confidential information, the system of operation, intellectual property, non-compete covenants, and obligations upon termination or expiration of the agreement. Additionally, they can act against any franchisee-related party violating applicable laws or threatening the brand, system, or other franchisees' businesses.
However, the FDD includes an addendum specific to franchises in North Dakota. This addendum modifies the standard agreement, stating that arbitration and mediation proceedings will be conducted at a site agreeable to all parties involved. Furthermore, the venue for any litigation arising from the franchise relationship between the franchisee and Amerispec Inspection Services will be within the state of North Dakota. This means that for franchisees in North Dakota, the location for dispute resolution is explicitly defined and subject to North Dakota law.