In Bft's grouped arbitration, what is the required action regarding mediation following the resolution of the initial 75 individual arbitrations?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
J. Grouped Arbitrations. To the extent permitted by applicable law and notwithstanding any other provision of this Agreement, to increase efficiency of resolution, in the event 75 or more similar arbitration demands are filed within a 30-day period: (a) the Parties shall cooperate to organize the arbitration demands into randomized groups of no more than 75 demands (plus, to the extent there are fewer than 75 arbitration demands remaining, a final group consisting of the remaining demands); (b) Developers' counsel shall organize and present the grouped demands to the arbitration provider in a format as required under the JAMS Mass Arbitration Procedures & Guidelines; (c) JAMS shall assess one set of filing and administrative fees per group and shall assign one arbitrator per group, subject to any applicable disclosure and disqualification procedures available under applicable law; (d) JAMS shall set one initial administrative conference per group; (e) regardless of the grouping described above, the arbitrator shall resolve all arbitrations within a group on an individual basis; (f) the first group of 75 arbitrations shall proceed on an individual basis, while the remaining cases are stayed and applicable statutes of limitations for those cases are tolled; (g) the Parties shall use their best efforts to complete the initial 75 individual arbitrations within 120 days after the initial administrative conference, and shall engage in good-faith mediation following resolution of the initial 75 individual arbitrations; (h) if mediation is unsuccessful, the remaining cases shall proceed on an individual basis in groups of 75 cases (plus, to the extent there are fewer than 75 arbitration demands remaining, a final group consisting of the remaining demands); and (i) no final award from an arbitrator in any one arbitration shall have preclusive effect in any other arbitration. The Parties agree to cooperate in good faith to implement the above grouped approach to administration of the arbitration demands.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–66)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, in the event that 75 or more similar arbitration demands are filed within a 30-day period, Bft requires a specific process for handling these disputes. After the first group of 75 arbitrations proceeds on an individual basis, and the parties use their best efforts to complete these arbitrations within 120 days after the initial administrative conference, the parties are then required to engage in good-faith mediation.
This mediation step is mandatory before any further individual arbitrations can proceed. If the mediation is unsuccessful, the remaining cases will then proceed individually in groups of 75, with any final group consisting of the remaining demands if fewer than 75. This structured approach aims to resolve disputes efficiently while ensuring each case is addressed individually.
For a prospective Bft franchisee, this means that if a large number of similar disputes arise, Bft has a pre-defined process involving initial individual arbitrations followed by mandatory mediation. This could potentially save time and resources compared to handling each case separately from the outset. However, franchisees should be aware that they are expected to engage in mediation in good faith, and if it fails, further arbitration will be necessary.