Do the parties waive the right to have any claim brought as a class action against Bft?
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 Bft's 2025 Franchise Disclosure Document, the parties involved in the franchise agreement expressly waive the right to bring, hear, administer, resolve, or arbitrate any claim or dispute as a class, collective, coordinated, consolidated, or representative action. This means that any legal proceedings related to the franchise agreement must be conducted on an individual basis, and no claim can be combined with claims from other franchisees or parties. Furthermore, neither an arbitrator nor an arbitration provider has the authority to hear, arbitrate, or administer any class, collective, coordinated, consolidated, or representative action, or to award relief to anyone but the individual in arbitration.
This waiver of class actions has significant implications for prospective Bft franchisees. It means that if a franchisee has a dispute with Bft, they must pursue the matter individually, which can be more expensive and time-consuming than participating in a class action. Additionally, the franchisee is limited to seeking individual relief and cannot obtain any non-individual relief. However, the agreement does allow parties to participate in a class-wide, collective, and/or representative settlement of claims, indicating a willingness to resolve disputes on a broader scale through settlement negotiations.
It is important to note that certain state laws may affect the enforceability of these waivers. For instance, in Illinois, nothing in the waiver shall bind any person to waive compliance with any provision of the Illinois Franchise Disclosure Act or any other law of the State of Illinois, to the extent applicable. Similarly, in North Dakota, the statutes of limitations under North Dakota Law apply with respect to claims arising under the North Dakota Franchise Investment Law. In Maryland, there are regulations against requiring a franchisee to waive the right to file a lawsuit in Maryland claiming a violation of the Maryland Franchise Registration and Disclosure Law. These state-specific provisions highlight the importance of understanding how local laws may impact the franchise agreement.
Prospective Bft franchisees should carefully consider the implications of waiving their right to participate in class actions and consult with an attorney to understand their rights and obligations under the franchise agreement and applicable state laws. They should also inquire about the franchisor's history of disputes and settlements to assess the likelihood of future legal issues.