If mediation is unsuccessful, is arbitration binding for disputes with Bang Cookies?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
| s. | Modification of the agreement | 18.L. | Requires writing signed by you and us, except for unilateral changes that we may make to the Manuals or our unilateral reduction of the scope of a restrictive covenant that we may make in our discretion. |
|---|---|---|---|
| t. | Integration/merger clauses | 18.M. | Only the terms of the Franchise Agreement and schedules to the Franchise Agreement and the respective signed exhibits to the Franchise Agreement are binding, subject to state law. Nothing in any agreement is intended to disclaim the express representations made in the Franchise Disclosure Document, its exhibits and amendments. |
| u. | Dispute resolution by arbitration or mediation | 18.G. | Except for certain claims for injunctive relief, all disputes must first be submitted to non-binding mediation in Bergen County, New Jersey and, if mediation is unsuccessful, then to binding arbitration in Bergen County, New Jersey. This provision is subject to applicable state law. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 42–49)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, if mediation is unsuccessful, disputes will proceed to binding arbitration. Specifically, except for claims seeking injunctive relief, all disputes must first go through non-binding mediation in Bergen County, New Jersey. If mediation does not resolve the issue, the dispute will then be subject to binding arbitration, also in Bergen County, New Jersey. This requirement is subject to applicable state law.
For a prospective Bang Cookies franchisee, this means that if a dispute arises with the franchisor that cannot be resolved through informal negotiation or mediation, the franchisee is obligated to participate in binding arbitration. Binding arbitration means that the decision made by the arbitrator is final and legally enforceable, with very limited options for appeal. This can be a faster and less expensive alternative to traditional litigation, but it also means the franchisee has less control over the outcome.
It is important to note that the FDD specifies that this provision is subject to applicable state law. Therefore, the enforceability and specific procedures of the arbitration clause may vary depending on the franchisee's location. Prospective franchisees should consult with legal counsel to understand the implications of the arbitration clause in their specific state and to assess the potential benefits and risks of agreeing to binding arbitration with Bang Cookies.