How many members will be on the arbitration panel for a Benihana franchise dispute?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
- 15.1.2 The arbitration panel will consist of three members, one appointed by BNC, one appointed by Franchisee, and one chosen by the two arbitrators appointed by the parties.
Source: Item 23 — Receipts (FDD pages 74–576)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, any disputes that go to arbitration will be handled by a panel of three members. Benihana will appoint one member, the franchisee will appoint another, and the two appointed arbitrators will then choose the third member.
This setup ensures that both parties have a direct say in the selection of the arbitration panel. By allowing each side to appoint an arbitrator, it aims to create a balanced panel with representation from both Benihana and the franchisee's perspectives. The selection of the third member by the initial two is intended to provide a neutral tie-breaker and facilitate consensus.
It's worth noting that the arbitrators are not authorized to award punitive or exemplary damages, which could limit the potential financial recovery in a dispute. The arbitration will take place in Miami, Florida, which may require the franchisee to travel depending on their location. Franchisees should consider these factors when evaluating the implications of the arbitration process.