Where must disputes with Bath Tune Up be mediated and arbitrated?
Bath_Tune_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
| PROVISION | SECTION IN AGREEMENT | SUMMARY |
|---|---|---|
| u. Dispute resolution by | 11.3 – 11.4 | Except for certain claims, and subject to state law, all |
| arbitration or | disputes must be mediated and arbitrated in Brown | |
| mediation | County, South Dakota. | |
| v. Choice of forum | 11.6 | Subject to applicable state law, claims for equitable or injunctive relief must be conducted in South Dakota. |
| w. Choice of law | 14.1 | Federal law applies to arbitration and trademark issues. The law of your state applies to amendment of your franchise agreement, the maximum rate of interest that can be charged, and post-termination non-competition issues. Except as required by applicable state law, South Dakota law applies to all other issues. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 38–41)
What This Means (2025 FDD)
According to Bath Tune Up's 2025 Franchise Disclosure Document, disputes with the company must be mediated and arbitrated in Brown County, South Dakota. The FDD specifies that this requirement is subject to certain claims and applicable state law. This means that not all disputes will necessarily be subject to mediation and arbitration in South Dakota, and the franchisee's state law may have an impact on this.
This requirement could mean increased costs for a franchisee who does not live in South Dakota, as they would need to travel to Brown County for mediation or arbitration proceedings. This could include expenses for travel, accommodation, and local legal representation. It's important to note that claims for equitable or injunctive relief must be conducted in South Dakota, regardless of state law.
The FDD also states that federal law applies to arbitration and trademark issues, while the franchisee's state law applies to amendments to the franchise agreement, the maximum interest rate that can be charged, and post-termination non-competition issues. Except as required by applicable state law, South Dakota law applies to all other issues. This means that while the location of dispute resolution is fixed, the applicable law may vary depending on the nature of the dispute.
Prospective franchisees should consult with a legal professional to understand the full implications of the dispute resolution process, including the costs and potential impact of having to mediate or arbitrate in South Dakota. They should also inquire about the specific types of claims that are excluded from this requirement and how their state laws might affect the process.