Does the Bft Development Agreement include a waiver of class actions?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
- I. Waiver of Class Actions.
THE PARTIES AGREE THAT ALL PROCEEDINGS ARISING OUT OF OR RELATED TO THIS AGREEMENT, OR THE DEVELOPMENT RIGHTS, WILL BE CONDUCTED ON AN INDIVIDUAL, NOT A CLASS-WIDE BASIS, AND THAT ANY PROCEEDING BETWEEN DEVELOPER, DEVELOPER'S GUARANTORS AND FRANCHISOR OR THEIR RESPECTIVE AFFILIATES, OFFICERS, OWNERS, OR EMPLOYEES MAY NOT BE CONSOLIDATED WITH ANY OTHER PROCEEDING BETWEEN FRANCHISOR AND ANY OTHER THIRD PARTY.
The Parties expressly waive the right to have any claim or dispute brought, heard, administered, resolved, or arbitrated as a class, collective, coordinated, consolidated, and/or representative action, and neither an arbitrator nor an arbitration provider shall have any authority to hear, arbitrate, or administer any class, collective, coordinated, consolidated, and/or representative action, or to award relief to anyone but the individual in arbitration.
The Parties also expressly waive the right to seek, recover, or obtain any non-individual relief.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–66)
What This Means (2025 FDD)
According to the 2025 Bft Franchise Disclosure Document, the Development Agreement includes a waiver of class actions. Specifically, all proceedings arising out of or related to the agreement will be conducted on an individual basis, not a class-wide basis. This means a developer cannot consolidate any proceeding with another third party.
The document states that both parties expressly waive the right to have any claim or dispute brought, heard, administered, resolved, or arbitrated as a class, collective, coordinated, consolidated, and/or representative action. Furthermore, neither an arbitrator nor an arbitration provider has the authority to hear, arbitrate, or administer any class action, or to award relief to anyone but the individual in arbitration. The parties also waive the right to seek, recover, or obtain any non-individual relief.
This waiver of class actions means that a Bft developer gives up the right to participate in a class action lawsuit against the franchisor. This is a common practice in franchising, as it limits the franchisor's exposure to large, costly lawsuits. However, it also means that a developer must pursue any claims against the franchisor individually, which can be more expensive and time-consuming.