Does Bee Organized have the option to elect out of arbitration for certain claims or disputes?
Bee_Organized Franchise · 2025 FDDAnswer from 2025 FDD Document
- (2) Arbitration Subject to the prerequisite requirements of non-binding mediation as set forth in Sub-Article 18.G.(1), and, except at Franchisor's election, as to 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, Franchisor and Franchisee agree that all disputes, controversies, and claims, arising from and/or related to this Agreement, the relationship between Franchisor and Franchisee, the System, and/or the validity of this Agreement and/or the Ancillary Agreements, shall be submitted, on demand of either Franchisor or Franchisee, to AAA for binding arbitration. Arbitration shall be conducted by one arbitrator in accordance with AAA's then current rules for commercial disputes, except as may be otherwise required in this Article 18.G. All arbitration proceedings shall be conducted in Johnson County, Kansas, or, if suitable AAA facilities are not available in Johnson County, Kansas, then at a suitable AAA location selected by the arbitrator that is located closest to Johnson County, Kansas. In connection with binding arbitration, Franchisor and Franchisee further agree that:
- (a) All matters relating to arbitration, will be governed by the United States Federal Arbitration Act, except as expressly or otherwise set forth in this Agreement;
- (b) The arbitration hearing shall be conducted within 180 days of the demand for arbitration;
- (c) The arbitrator shall render written findings of fact and conclusions of law;
- (d) Except as may be otherwise required and/or prohibited by this Agreement including, but not limited to Articles 18.I., 18.J., 18.N., 18.O., 18.R., 18.T., and 18.X. of this Agreement, the arbitrator has the right to award or include in his or her award any relief that he or she determines to be proper, including monetary damages, interest on unpaid sums, specific performance, injunctive relief,
Source: Item 23 — RECEIPTS (FDD pages 54–218)
What This Means (2025 FDD)
According to Bee Organized's 2025 Franchise Disclosure Document, the franchisor has the option to elect out of arbitration for specific claims or disputes. The standard Bee Organized franchise agreement mandates that disputes are resolved through binding arbitration via the American Arbitration Association (AAA) in Johnson County, Kansas. However, this is subject to non-binding mediation as a prerequisite.
Specifically, Bee Organized retains the right to elect out of arbitration concerning a breach of the Franchise Agreement by the franchisee. This election applies to claims or disputes that, under the agreement's terms, could entitle Bee Organized to injunctive relief. An example of such a situation is when a franchisee violates or purportedly violates Article 6 of the agreement.
This clause provides Bee Organized with flexibility in how disputes are handled, allowing them to pursue injunctive relief in court rather than through arbitration if they deem it more appropriate. For a prospective franchisee, this means that while most disputes will be subject to arbitration, Bee Organized can choose a different route for certain critical violations, potentially leading to quicker and more decisive legal action.