What rules govern the arbitration process for Bombs Away franchise disputes?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
ion subject to this indemnification and control all aspects of defending the Action (including negotiations and settlement), at Franchisee's expense. Such an undertaking shall not diminish Franchisee's obligation to indemnify the Indemnitees.
ARTICLE 17. DISPUTE RESOLUTION
17.1 Arbitration.
- (a) Disputes Subject to Arbitration. Except as expressly provided in subsection (c) and (d), any controversy or claim between the parties (including any controversy or claim arising out of or relating to this Agreement or its formation, and including any question of arbitrability) shall be resolved by arbitration administered by the American Arbitration Association in accordance with its Commercial Arbitration Rules, including the Optional Rules for Emergency Measures of Protection. Judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction.
- (b) Location. The place of arbitration shall be the city and state where Bombs Away Franchising's headquarters are located.
- (c) Injunctive Relief. Either party may apply to the arbitrator seeking injunctive relief until the arbitration award is rendered or the controversy is otherwise resolved. Either party also may, without waiving any remedy or right to arbitrate under this Agreement, seek from any court having jurisdiction any interim or provisional injunctive relief.
- (d) Intellectual Property Claims. Either party may bring a claim involving an alleged infringement of any of Bombs Away Franchising's intellectual property rights in a court authorized to hear such claims under Section 17.5 of this Agreement.
- (e) Confidentiality. All documents, information, and results pertaining to any arbitration or lawsuit will be confidential, except as required by law or as required for Bombs Away Franchising to comply with laws and regulations applicable to the sale of franchises.
- (f) Performance During Arbitration or Litigation. Unless this Agreement has been terminated, Bombs Away Franchising and Franchisee will comply with this Agreement and perform their respective obligations under this Agreement during the arbitration or litigation process.
- 17.2 Damages. In any controversy or claim arising out of or relating to this Agreement, each party waives any right to punitive or other monetary damages not measured by the prevailing party's actual damages, except damages expressly authorized by federal statute and damages expressly authorized by this Agreement.
- 17.3 Waiver of Class Actions. The parties agree that any claims will be arbitrated, litigated, or otherwise resolved on an individual basis, and waive any right to act on a class-wide basis.
- 17.4 Time Limitation. Any arbitration or other legal action arising from or related to this Agreement must be instituted within two years from the date such party discovers the conduct or event that forms the basis of the arbitration or other legal action. The foregoing time limit does not apply to claims (i) by one party related to non-payment under this Agreement by the other party, (ii) for indemnity under Article 16, or (iii) related to unauthorized use of Confidential Information or the Marks.
- 17.5 Venue Other Than Arbitration. For any legal proceeding not required to be submitted to arbitration, the parties agree that any such legal proceeding will be brought in the United States District Court where Bombs Away Franchising's headquarters is then located. If there is no federal jurisdiction over the dispute, the parties agree that any such legal proceeding will be brought in the court of record of the state and county where Bombs Away Franchising's headquarters is then located. Each party consents to the jurisdiction of such courts and waives any objection that it, he or she may have to the laying of venue of any proceeding in any of these courts.
- 17.6 Legal Costs. In any legal proceeding (including arbitration) related to this Agreement or any guaranty, the non-prevailing party shall pay the prevailing party's attorney fees, costs and other expenses of the legal proceeding. "Prevailing party" means the party, if any, which prevailed upon the central litigated issues and obtained substantial relief.
ARTICLE 18. MISCELLANEOUS
- 18.1 Relationship of the Parties. The parties are independent contractors, and neither is the agent, partner, joint venturer, or employee of the other.
Source: Item 22 — CONTRACTS (FDD pages 35–36)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, any controversy or claim between Bombs Away and the franchisee, including those arising from the franchise agreement, will be resolved through arbitration administered by the American Arbitration Association (AAA) following its Commercial Arbitration Rules, including the Optional Rules for Emergency Measures of Protection. This excludes claims involving infringement of Bombs Away's intellectual property rights, which may be brought in a court authorized to hear such claims. Judgment on the arbitrator's award can be entered in any court with jurisdiction.
The location for arbitration will be the city and state where Bombs Away's headquarters is located. Either party can seek injunctive relief from the arbitrator until a final award is rendered or from a court for interim injunctive relief, without waiving the right to arbitrate. All documents, information, and results related to any arbitration or lawsuit will be kept confidential, except when disclosure is required by law or for Bombs Away to comply with franchise sales regulations.
Both Bombs Away and the franchisee must continue to comply with the franchise agreement and fulfill their obligations during any arbitration or litigation, unless the agreement has been terminated. Franchisees should note that they waive any right to punitive or other monetary damages not based on actual damages, except those expressly authorized by federal statute or the agreement. Additionally, all claims must be pursued on an individual basis, as class actions are waived. Any arbitration or legal action related to the agreement must be initiated within two years of discovering the event that forms the basis of the claim, with exceptions for non-payment, indemnity claims, or unauthorized use of confidential information or marks.
For legal proceedings not subject to arbitration, the venue will be the United States District Court where Bombs Away's headquarters is located, or if there is no federal jurisdiction, the court of record in the state and county of Bombs Away's headquarters. The non-prevailing party in any legal proceeding, including arbitration, will be responsible for the prevailing party's attorney fees, costs, and other expenses. These arbitration and dispute resolution terms also apply to the Guaranty attached to the Franchise Agreement.