Under what circumstances does the prerequisite requirement of non-binding mediation not apply to Bang Cookies franchise disputes, at the Franchisor's election?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
Notwithstanding the preceding paragraph, Franchisor and Franchisee agree this Sub-Article 18.G.(1) and, thereby, the prerequisite requirement of non-binding mediation, shall not, at Franchisor's election, apply to: (a) any claims or disputes related to or concerning a breach of this Agreement by Franchisee that, under the terms of this Agreement, may entitle Franchisor to the award of injunctive relief including, but not limited to, Franchisee's violation or purported violation of Article 6 of this Agreement; and/or (b) claims by either Franchisor or Franchisee under this Agreement that relates to either Franchisor's or Franchisee's failure to pay fees or other monetary obligations due under this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, there are specific circumstances where the requirement for non-binding mediation in dispute resolution does not apply, and this is at Bang Cookies's discretion. This means that Bang Cookies can choose to bypass mediation and proceed directly to arbitration or other legal avenues in these situations.
Specifically, the non-binding mediation prerequisite does not apply to (a) claims or disputes related to a breach of the Franchise Agreement by the franchisee that would allow Bang Cookies to seek injunctive relief, including violations of Article 6 of the agreement, and/or (b) claims by either Bang Cookies or the franchisee regarding the failure to pay fees or other monetary obligations under the Franchise Agreement. Injunctive relief typically involves a court order requiring a party to stop doing something, such as violating a non-compete clause or misusing trademarks.
For a prospective Bang Cookies franchisee, this means that if they are in breach of contract in a way that could cause immediate and irreparable harm to Bang Cookies, or if there is a dispute over unpaid fees, Bang Cookies can choose to skip mediation and pursue other legal remedies. This could expedite the resolution process but also potentially increase legal costs and escalate the conflict more quickly. Franchisees should be aware of these conditions and ensure they understand their obligations under the agreement to avoid such situations.