What happens to the arbitration provisions upon termination or expiration of the Apricot Lane franchise agreement?
Apricot_Lane Franchise · 2025 FDDAnswer from 2025 FDD Document
Notwithstanding anything to the contrary contained in this section, FRACHISOR and FRANCHISEE each have the right in a proper case to seek temporary restraining orders and temporary or preliminary injunctive relief from a court of competent jurisdiction. In that case, FRACHISOR and FRANCHISEE agree to contemporaneously submit their dispute to arbitration on the merits according to this section. The provisions of this section will continue in full force and effect notwithstanding the termination or expiration of this Agreement and are intended to benefit and bind certain third party non-signatories
B. Governing Law
All matters relating to arbitration will be governed by the Federal Arbitration Act (9 U.S.C. §§ 1 et seq.). Except to the extent governed by the Federal Arbitration Act, the United States Trademark Act of 1946 (Lanham Act 15 U.S.C. §§ 1051 et seq.), the United States Copyright Act, or other federal law, this Agreement shall be governed by the laws of the state in which the Franchised Business is located, which laws shall prevail in the event of any conflict of law.
Source: Item 23 — RECEIPTS (FDD pages 51–222)
What This Means (2025 FDD)
According to the 2025 Apricot Lane Franchise Disclosure Document, the arbitration provisions outlined in Section 23 will remain in effect even after the termination or expiration of the Franchise Agreement. This means that any disputes arising even after the agreement ends must still be submitted to arbitration, as specified in the agreement. These provisions are designed to benefit and bind not only Apricot Lane and the franchisee but also certain third-party non-signatories.
Furthermore, the FDD specifies that all matters relating to arbitration will be governed by the Federal Arbitration Act. However, the laws of the state in which the franchised business is located will govern the agreement, except to the extent governed by the Federal Arbitration Act, the United States Trademark Act of 1946 (Lanham Act 15 U.S.C. §§ 1051 et seq.), the United States Copyright Act, or other federal law. This ensures a legal framework for the arbitration process, with federal law taking precedence in specific areas.
For a prospective Apricot Lane franchisee, this means that the commitment to resolve disputes through arbitration extends beyond the active term of the franchise agreement. It is crucial to understand the implications of these provisions, as they dictate the method of dispute resolution even after the business relationship concludes. Franchisees should seek legal counsel to fully comprehend their rights and obligations under these clauses.