Under what circumstance can Aw elect to proceed by judicial process instead of arbitration?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
commenced until the earlier of thirty (30) days from the selection of the Mediator, or the mutual agreement by both parties that mediation has been unsuccessful, or if the notified party fails to respond to the
requesting party within thirty (30) days of the delivery of notice requesting mediation. The parties will share equally all fees and expenses of the mediator.
18.2 Arbitration. Except to the extent we elect to proceed by judicial process as provided in Paragraph 18.3 below, any controversy, dispute, claim or question arising out of, in connection with, or in relation to this Agreement or its interpretation, performance, or any breach thereof, which cannot be settled amicably between the parties shall be determined solely and exclusively by arbitration with venue in Chicago, Illinois and shall be heard by one arbitrator that has specific franchise experience in accordance with the then existing commercial Rules of the American Arbitration Association ("Rules"). The parties hereby agree that arbitration shall be conducted on an individual, not a class-wide basis, and that an arbitration proceeding between us shall not be consolidated with any other arbitration proceeding involving us and any non-party to this Agreement, including other franchisees. Judgment upon any award, which may include an award of damages, may be entered in the courts of Cook County, Illinois, in the court of any jurisdiction in which you are located, or in any other court having jurisdiction thereof.
The arbitration rules provided for herein shall apply, and the arbitration may proceed, and the arbitrator has jurisdiction, regardless of whether any party fails to actively participate or appear. In the event that any party fails without good cause (i) to appear at any properly noticed arbitration proceeding; or (ii) to make payment in full of its share of the required arbitration fees and costs within ten (10) days after notice and demand, absent a previously issued court order to the contrary, then the arbitrator or the organization/entity administering the arbitration shall be authorized to enter a final award against such party, notwithstanding the failure to appear or to make the required payment.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, Aw generally prefers disputes to be settled through arbitration, but there are specific exceptions where Aw can choose to pursue judicial processes instead.
Aw is entitled to seek temporary and permanent injunctions and orders of specific performance in a court of competent jurisdiction, without needing to post a bond. This applies to enforcing a franchisee's obligations regarding the use of Aw's trademarks, non-disclosure and non-competition agreements, and to prevent actions that violate laws, endanger the public, or harm the goodwill associated with the Aw brand. The franchisee waives any claims for damages if an injunction or specific performance order is later deemed improperly issued.
Additionally, Aw has the right to proceed through judicial processes instead of arbitration to enforce a franchisee's payment obligations under Section 10 of the agreement and to collect any fees that are due and owing to Aw. This means that Aw can directly sue a franchisee in court to recover unpaid royalties, marketing fund contributions, or other fees, rather than going through the arbitration process. This provides Aw with a potentially faster and more direct route to recover funds owed by the franchisee.