Does the B Bops Franchise Agreement require disputes to be resolved through arbitration or mediation?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
| U. Dispute resolution by arbitration or mediation | Section 17 | Except for certain claims related to use of the Licensed Marks or proprietary information, all disputes must be arbitrated in Des Moines, Iowa. | | V. Choice of forum2 | Section 17 | Arbitration must be commenced in the State of Iowa. | | W. Choice of law2 | Section 25 | Iowa law applies (subject to state law). |
| Provision | Section in Application Agreement | Summary |
|---|---|---|
| A. Term of Agreement | Section 3 | The Company will inform you within 90 days from the effective date of the Application Agreement whether development rights or franchise rights will be granted. |
| B. Renewal or Extension of | None | Not applicable. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 40–49)
What This Means (2025 FDD)
According to B Bops's 2025 Franchise Disclosure Document, dispute resolution for the Development Agreement involves arbitration in Des Moines, Iowa. Section 17 specifies that, with the exception of certain claims pertaining to the use of licensed marks or proprietary information, all disputes must be arbitrated. The arbitration must be commenced in the State of Iowa, and Iowa law applies, subject to state law.
This means that if a B Bops franchisee has a dispute with the franchisor related to the Development Agreement (excluding claims about licensed marks or proprietary information), they must resolve it through arbitration rather than through the court system. The arbitration will take place in Des Moines, Iowa, regardless of where the franchisee's B Bops location is. This could involve travel expenses and legal costs associated with arbitrating in Iowa.
It is important to note that the Franchise Agreement has similar terms. Section 27 states that except for certain claims, all disputes must be arbitrated in Des Moines, Iowa. The arbitration must be commenced in the State of Iowa, and Iowa law applies. Therefore, disputes arising from the Franchise Agreement will also be subject to arbitration in Iowa, potentially impacting franchisees in terms of cost and convenience.
Prospective B Bops franchisees should carefully consider the implications of these dispute resolution provisions, particularly the requirement to arbitrate in Iowa, and seek legal counsel to understand their rights and obligations under the Development and Franchise Agreements.