Under the Body20 franchise agreement, what rules govern the arbitration proceedings?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
16.3 Arbitration.
- (a) Procedure. Except as stated in Section 16.3(d) (Excepted Disputes), all disputes between you, your Affiliates, Owners, guarantors, and/or your or your Affiliates' officers, directors, and employees, on the one hand, and us, our affiliates, and/or our or our affiliates' officers, directors and employees, on the other hand, relating to this Agreement, our relationship with you, or your Studio will be resolved by binding arbitration. The arbitration proceeding shall be conducted by one arbitrator and in accordance with then-current Commercial Arbitration Rules of the AAA. All arbitration proceedings will be held at AAA's offices or other suitable offices that we select in the metropolitan area in which our principal place of business is then located.
- (b) Individual Actions. We and you agree that arbitration will be conducted on an individual, not a class-wide, basis and that an arbitration proceeding between us and you may not be consolidated with any other arbitration proceeding between us and any other person. Notwithstanding the foregoing or anything to the contrary in this Section 16.3, if any court or arbitrator determines that this prohibition on class-wide arbitration is unenforceable with respect to a dispute that otherwise would be subject to arbitration under this Section 16.3, then the parties agree that this arbitration clause shall not apply to that dispute and that such dispute will be resolved in a judicial proceeding in accordance with Section 16.3(d) (Excepted Disputes).
- (c) Relief. The arbitrator has the right to award or include in his or her award any relief which he or she deems proper, including money damages (with interest on unpaid
amounts from the date due), specific performance, injunctive relief, and attorneys' fees (on a solicitor and its own client basis) and costs, provided that the arbitrator may declare any Mark generic or otherwise invalid or, except as expressly provided in Section 16.5 (Mutual Waiver of Punitive Damages), award any special, consequential, exemplary, or punitive damages against either party (we and you hereby waiving to the fullest extent permitted by law, except as expressly provided in Section 16.5 below, any right to or claim for any special, consequential, exemplary, or punitive damages against the other).
Source: Item 23 — RECEIPT (FDD pages 74–251)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, disputes between the franchisee and Body20, its affiliates, owners, and employees will be resolved through binding arbitration, with some exceptions. The arbitration will be conducted by a single arbitrator following the American Arbitration Association's (AAA) Commercial Arbitration Rules. The arbitration proceedings will take place at AAA offices or other suitable offices selected by Body20 in the metropolitan area of its principal business location. This means franchisees may need to travel to Body20's chosen location for arbitration.
The Body20 franchise agreement specifies that arbitration will be conducted on an individual basis, not as a class-wide action. Franchisees are prohibited from consolidating their arbitration proceedings with any other person against Body20. However, if a court or arbitrator deems the prohibition on class-wide arbitration unenforceable, the arbitration clause will not apply, and the dispute will be resolved in a judicial proceeding.
The arbitrator in a Body20 franchise dispute has the authority to award relief, including monetary damages (with interest), specific performance, injunctive relief, and attorneys' fees and costs. However, the arbitrator cannot declare any Body20 mark generic or invalid. Also, the arbitrator cannot award special, consequential, exemplary, or punitive damages against either party, as both Body20 and the franchisee waive any right to claim such damages, except as expressly provided in Section 16.5 regarding the mutual waiver of punitive damages.