Where must any judicial action or legal proceeding be brought by Bang Cookies, subject to mediation and arbitration?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
ILLINOIS FRANCHISE AND DEVELOPMENT AGREEMENT AMENDMENT
Amendments to the Bang Cookies Franchise Agreement
In recognition of the requirements of the Illinois Franchise Disclosure Act, 815 ILCS 705/1 to 705/45, and Ill. Admin. Code tit. 15, §200.100 et seq., the undersigned agree to the following modifications to the Bang Cookies Franchise LLC Franchise Agreement (the "Franchise Agreement") and, if Franchisor and Franchisee both sign the Bang Cookies Franchise LLC Multi-Unit Development Agreement (the "Development Agreement"), as follows:
- Article 18.F. of the Franchise Agreement, and if Franchisee executes a Development Agreement, Article 7.5 of the Development Agreement, under the heading "Governing Law", shall be amended by the addition of the following statement added after the end of the last sentence of Article 18.F. of the Franchise Agreement and Article 7.5 of the Development Agreement:
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.
Your rights upon termination and non-renewal of a Franchise Agreement are set forth in Sections 19 and 20 of the Illinois Franchise Disclosure Act.
Section 41 of the Illinois Franchise Disclosure Act Provides that any condition, stipulation or provision purporting to bind any person acquiring any franchise to waive compliance with the Illinois Franchise Disclosure Act, or any other law of Illinois is void
- Article 18.G. of the Franchise Agreement, and if Franchisee executes a Development Agreement, Article 7.6 of the Development Agreement, under the heading "Choice of Law, Non-Binding Mediation, Binding Arbitration, and Consent to Jurisdiction", shall be amended by the addition of the following statement added after the end of the last sentence of Article 18.G. of the Franchise Agreement and Article 7.6 of the Development Agreement:
Illinois Addendum: Illinois law governs the agreements between the parties to this franchise.
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, the location of judicial actions or legal proceedings is not explicitly detailed within the provided excerpts, except for franchisees operating in Illinois and Washington. For Illinois franchisees, any provision in the Franchise Agreement that designates jurisdiction or venue outside the State of Illinois is void, although the agreement may provide for arbitration outside of Illinois. For Washington franchisees, in any arbitration involving a franchise purchased in Washington, the arbitration site must be in the State of Washington, or in a place mutually agreed upon at the time of the arbitration or as determined by the arbitrator.
This means that, in general, the FDD excerpts do not specify a particular location for legal proceedings. The agreement may allow Bang Cookies to pursue legal action against franchisees in a location that is not convenient for them, potentially increasing the franchisee's legal costs. Franchisees should seek clarification regarding the venue for dispute resolution, as it can significantly impact their ability to defend themselves in legal proceedings.
Prospective franchisees should inquire with Bang Cookies about the specific venue or jurisdiction that would apply to any legal actions arising from the franchise agreement. It would be prudent to consult with a legal professional to understand the implications of venue selection and arbitration clauses in the franchise agreement, especially considering the laws of the franchisee's state.