Are disputes related to the relationship between the Franchisor and Franchisee subject to arbitration in the Bang Cookies franchise agreement?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
In any arbitration involving a franchise purchased in Washington, the arbitration site shall be either in the State of Washington, or in a place mutually agreed upon at the time of the arbitration or as determined by the arbitrator.
Illinois Addendum: Illinois law governs the agreements between the parties to this franchise.
Section 4 of the Illinois Franchise Disclosure Act Provides that any provision in a Franchise Agreement that designates jurisdiction or venue outside the State of Illinois is void. However, a Franchise Agreement may provide for arbitration in a venue outside Illinois.
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, the franchise agreement includes provisions for resolving disputes through arbitration, especially for franchisees in Washington state. Specifically, for franchises purchased in Washington, the arbitration site must be in Washington state or a location mutually agreed upon by both parties or determined by the arbitrator. This amendment acknowledges the Washington State Franchise Investment Protection Act, Chapter 19.100 RCW, and ensures that the arbitration process respects the franchisee's rights under Washington law.
Additionally, the Illinois Addendum addresses dispute resolution, stating that while the franchise agreement may provide for arbitration in a venue outside Illinois, Illinois law governs the agreements between the parties. This means that while arbitration can occur, the legal framework of Illinois will be applied. The Illinois Franchise Disclosure Act also voids any provision designating jurisdiction or venue outside of Illinois, reinforcing the state's control over legal proceedings related to the franchise agreement.
These clauses are important for prospective franchisees as they define the legal landscape in case of disputes with Bang Cookies. Franchisees should be aware of the specific state laws that apply to their franchise agreement, particularly concerning arbitration and dispute resolution venues. It is advisable for franchisees to consult with legal counsel to fully understand their rights and obligations under the franchise agreement and any applicable state laws.