Does the Angry Chickz arbitration clause extend to disputes arising from the relationship between Angry Chickz and the Developer?
Angry_Chickz Franchise · 2025 FDDAnswer from 2025 FDD Document
- 11.1.4 Company and Developer agree that arbitration shall be conducted on an individual, not a class-wide, basis, that only Company (and its Affiliates and Company and its respective owners, officers, directors, managers, agents and employees, as applicable) and Developer (and its Affiliates and Developer and its respective owners, officers, directors, managers, agents and employees, as applicable) may be the parties to any arbitration proceeding described in this Section, and that no such arbitration proceeding shall be consolidated with any other arbitration proceeding involving us and/or any other Entity.
Notwithstanding the foregoing or anything to the contrary in this Section, if any court or arbitrator determines that all or any part of the preceding sentence is unenforceable with respect to a dispute that otherwise would be subject to arbitration under this Section, then Company and Developer agree that this arbitration clause shall not apply to that dispute and that such dispute will be resolved in a judicial proceeding in accordance with this ARTICLE 11.
11.1.5 The provisions of this Section are intended to benefit and bind certain thirdparty non-signatories and will continue in full force and effect subsequent to and notwithstanding the expiration or termination of this Agreement.
11.1.6 Notwithstanding anything to the contrary contained in this Section, Company and Developer have the right to obtain temporary restraining orders and temporary or preliminary injunctive relief from a court of competent jurisdiction.
Source: Item 23 — RECEIPTS (FDD pages 54–260)
What This Means (2025 FDD)
According to the 2025 Angry Chickz Franchise Disclosure Document, the arbitration clause does extend to disputes between Angry Chickz and the Developer. Specifically, the FDD states that arbitration will be conducted on an individual basis, not a class-wide basis. The only parties to any arbitration proceeding are Angry Chickz (including its affiliates, owners, officers, directors, managers, agents, and employees) and the Developer (including its affiliates, owners, officers, directors, managers, agents, and employees). The clause also specifies that no arbitration proceeding shall be consolidated with any other arbitration proceeding involving Angry Chickz and/or any other entity.
However, there are exceptions to this arbitration agreement. If any court or arbitrator determines that the clause preventing class-wide arbitration or consolidation is unenforceable, then the arbitration clause does not apply to that specific dispute. In such cases, the dispute will be resolved in a judicial proceeding. Additionally, both Angry Chickz and the Developer retain the right to seek temporary restraining orders and temporary or preliminary injunctive relief from a court of competent jurisdiction, regardless of the arbitration agreement.
This means that while most disputes between Angry Chickz and a Developer will be subject to individual arbitration, there are specific circumstances where a court may intervene or where judicial proceedings may be necessary. Prospective developers should carefully consider these provisions and consult with legal counsel to understand the full implications of the arbitration clause and its exceptions.