Who bears the costs of arbitration for a Bath Tune Up franchise in Minnesota?
Bath_Tune_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
The franchise agreement requires binding arbitration. The arbitration will occur in a state other than Minnesota, with costs being borne by the non-prevailing party. Under Minnesota Statutes § 80C.21 and Minnesota Rule Part 2860.4400J, this provision may not in any way invalidate or reduce any of the franchise owner's rights that are listed in Chapter 80C of the Minnesota Statutes.
Source: Item 23 — RECEIPTS (FDD pages 52–222)
What This Means (2025 FDD)
According to the 2025 Bath Tune Up Franchise Disclosure Document, the non-prevailing party bears the costs of arbitration in Minnesota. The FDD specifies that the franchise agreement mandates binding arbitration, which will occur in a state other than Minnesota.
This means that if a Bath Tune Up franchisee in Minnesota enters into an arbitration dispute with the franchisor and loses, they will be responsible for covering the arbitration costs. Conversely, if the franchisee wins the arbitration, Bath Tune Up would bear the costs.
However, the FDD also clarifies that certain provisions in the franchise agreement, including the arbitration clause, cannot override or diminish any of the franchisee's rights as outlined in Chapter 80C of the Minnesota Statutes. This ensures that Minnesota franchisees retain their legal protections under state law, regardless of what the franchise agreement stipulates regarding arbitration location or cost allocation.