Are there any exceptions to the arbitration requirement for Amorino franchise disputes?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
Except as otherwise provided in this Agreement, if the mediation is not successful, any controversy, claim, cause of action or dispute arising out of, or relating to your Store or this Agreement including, but not limited to (i) any claim by either party, or any person in privity with or claiming through, on behalf of or in the right of either party, concerning the entry into, performance under or termination of this Agreement or any other agreement entered into by Franchisor, or its subsidiaries or affiliates, and Franchisee, (ii) any claim against a past or present employee, officer, director or agent of either party, (iii) any claim of breach of this Agreement, and (iv) any claims arising under state or federal laws, shall be submitted to final and binding arbitration as the sole and exclusive remedy for any such controversy or dispute.
Unless, prohibited by applicable law, and except with respect to claims for payment defaults, any claim shall be made by filing a written demand for arbitration within one (1) year from the date on which Franchisor or Franchisee knew or should have known, in the exercise of reasonable diligence, of the conduct, act or other event or occurrence first giving rise to the claim; otherwise, the right to any remedy shall be deemed forever waived and lost.
Claims by Franchisor regarding payment defaults may be made at any time within the applicable legal statute of limitations.
Claims allegedly in defense against claim for payment are barred if not made within the one-year period referred to above.
Persons in privity with or claiming through, on behalf of or in the right of Franchisee and Franchisor include, but are not limited to, spouses and other family members, heirs, executors, representatives, successors and assigns.
- (2) The right and duty of the parties to this Agreement to resolve any disputes by arbitration shall be governed exclusively by the Federal Arbitration Act, as amended, and arbitration shall be conducted pursuant to the then-prevailing Commercial Arbitration Rules of the AAA.
The arbitration shall be held at the office of the AAA in New York County, New York.
Any dispute as to the arbitrability of any controversy, claim, cause of action or dispute shall also be determined by arbitration.
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
According to Amorino's 2025 Franchise Disclosure Document, disputes are generally resolved through arbitration, but there are exceptions. Specifically, claims for payment defaults are not subject to the mandatory arbitration requirement. This means Amorino can pursue legal action in court to recover unpaid amounts from a franchisee without first going through arbitration.
Additionally, any claim must be made within one year from when the franchisee or Amorino knew or should have known about the event giving rise to the claim. Failure to file a written demand for arbitration within this one-year period results in a waiver of any remedy, unless prohibited by applicable law. However, claims by Amorino regarding payment defaults can be made at any time within the applicable legal statute of limitations, providing Amorino with more flexibility in pursuing these claims.
The arbitration process is governed by the Federal Arbitration Act and the Commercial Arbitration Rules of the AAA. The arbitration will be held at the office of the AAA in New York County, New York. This location is fixed, which may present a cost or logistical challenge for franchisees located far from New York. The selection of the arbitrator involves choosing one from a panel of neutral arbitrators provided by the AAA using the striking method. The arbitrator has the discretion to award the fees and expenses of the proceeding to the prevailing party; otherwise, the parties will share the costs.