Are discussions during mediation between Aunt Millies Bakeries and the distributor admissible as evidence in litigation?

According to Aunt Millies Bakeries' 2025 Franchise Disclosure Document, any discussions, negotiations, findings, or other statements made by the mediator and/or the parties in connection with the mediation are considered privileged and confidential. This means that these communications are protected and cannot be used as evidence in any litigation. This provision aims to encourage open and honest communication during the mediation process, as parties can speak freely without fear of their words being used against them in court.

This protection of confidentiality is a standard practice in mediation to foster a more conducive environment for resolving disputes. The mediation process for Aunt Millies Bakeries begins with either party initiating mediation within five days of discovering the dispute, by submitting a written request to the Judicial Arbitration & Mediation Services, Inc. (JAMS) or another mutually agreed-upon mediation service. The mediation process should promptly begin and conclude within ten business days of the request, unless both parties agree to extend the period.

The expenses of the mediation service are to be shared equally between Aunt Millies Bakeries and the distributor, while each party bears their own additional expenses related to the mediation. It's also important to note that starting a dispute resolution procedure does not prevent Aunt Millies Bakeries from taking actions related to the distributor's business, including the operation of the distributor's route. However, Aunt Millies Bakeries agrees not to sell, nor require the distributor to sell, the Distribution Rights until the dispute resolution process is concluded or the time for further dispute resolution has expired.

If mediation fails to resolve the dispute, either party can file an arbitration demand within ten days following the conclusion of the mediation. This demand is limited to the issues discussed during mediation. The agreement specifies that arbitration will be binding and conducted by JAMS, with the arbitrator applying the substantive law outlined in the agreement, while the Federal Arbitration Act governs arbitration matters.