In legal disputes between Black Bear Diner and the developer, is the right to a jury trial waived?
Black_Bear_Diner Franchise · 2025 FDDAnswer from 2025 FDD Document
Arbitration. This Agreement is a written agreement evidencing a transaction involving commerce and is, therefore, subject to the terms and provisions of the Federal Arbitration Act, Title 9 of the United States Code. All disputes arising out of or relating to this Agreement, or to any other agreements between the parties or with regard to interpretation, formation or breach of this or any other agreement between the parties, shall be settled by binding arbitration conducted in Redding, California, or such place as may be mutually agreeable to the parties, in accordance with the Commercial Arbitration Rules of the American Arbitration Association then in effect. or at such other place as may be mutually agreeable to the parties. The decision of the arbitrators will be final and binding on all parties to the dispute; however, the arbitrators may not under any circumstances: (i) stay the effectiveness of any pending termination of this Agreement; (ii) assess punitive or exemplary damages; or (iii) make any award which extends, modifies or suspends any lawful term of this Agreement or any reasonable standard of business performance. A judgment may be entered upon the arbitration award by any state or federal court in California or the state within which the Development Area is located. The prevailing party in any action or proceeding arising under, out of, in connection with, or in relation to this Agreement or the Black Bear Diner restaurant conducted pursuant to this Agreement shall be entitled to recover its reasonable attorneys' fees and costs.
DEVELOPER EXPRESSLY ACKNOWLEDGES THAT DEVELOPER HAS READ THE TERMS OF THIS BINDING ARBITRATION PROVISION AND SPECIFICALLY AFFIRMS THAT THIS PROVISION IS ENTERED INTO WILLINGLY AND VOLUNTARILY AND WITHOUT ANY FRAUD, DURESS OR UNDUE INFLUENCE ON THE PART OF FRANCHISOR OR ANY OF FRANCHISOR'S AGENTS OR EMPLOYEES.
13.3 Consent to Jurisdiction
The parties agree that any action brought by Developer against Franchisor in any court, whether federal or state, shall be brought within such state and in the judicial district in which Franchisor has its principal place of business. Any action brought by Franchisor against Developer in any court, whether federal or state, may be brought within the state and judicial district in which
Franchisor has its principal place of business. The parties do hereby waive all questions of personal jurisdiction or venue for the purposes of carrying out this provision.
Source: Item 23 — RECEIPT (FDD pages 56–243)
What This Means (2025 FDD)
According to Black Bear Diner's 2025 Franchise Disclosure Document, the developer waives certain rights regarding dispute resolution. Specifically, all disputes will be settled through binding arbitration, and the developer acknowledges they are entering into this agreement willingly. This means that instead of going to court and having a trial, disputes will be resolved by a neutral arbitrator.
Furthermore, the document states that any action brought by the developer against Black Bear Diner must be brought in the state and judicial district where Black Bear Diner has its principal place of business. Conversely, any action brought by Black Bear Diner against the developer can also be brought in the state and judicial district where Black Bear Diner has its principal place of business. The parties agree to waive all questions of personal jurisdiction or venue for the purposes of carrying out this provision.
In practical terms, this means a developer gives up the right to sue Black Bear Diner in the developer's local court. They consent to the jurisdiction and venue where Black Bear Diner is based. This could potentially add expenses for travel and local counsel should a dispute arise. The arbitration clause also limits the remedies available, as the arbitrators cannot stay a termination of the agreement, assess punitive damages, or modify any lawful term of the agreement.