What must the arbitrator provide in their decision for a Beard Papas arbitration?

According to the 2025 Beard Papas FDD, if an arbitrator in any arbitration proceeding issues an award, judgment, decision, or order finding that the franchisee breached the agreement, Beard Papas is entitled to recover all reasonable attorney fees, costs, and expenses associated with the arbitration or litigation. These recoverable fees include attorney fees, arbitration fees, arbitrator fees, deposition expenses, expert witness fees, and filing fees. This applies both to the standard Franchise Agreement and the Multi-Unit Development Agreement.

This means that a prospective Beard Papas franchisee could be responsible for covering Beard Papas' legal costs if the arbitrator rules against them in a dispute. This could create a significant financial risk for franchisees, especially if the legal proceedings are complex or lengthy. Franchisees should carefully consider this potential liability when evaluating the franchise opportunity and ensure they have sufficient resources to cover such costs if necessary.

It is fairly common in franchise agreements for the prevailing party in a dispute to be entitled to recover their attorney's fees and costs. However, franchisees should be aware of the specific terms in the Beard Papas agreement and understand the potential financial implications of an unfavorable arbitration decision.