Where is the mediation for Boulder Designs required to take place?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
Sections 23.2 and 23.7 of the Franchise Agreement provides that Franchisees must consent to the jurisdiction of the McLennan County, Texas.
The Securities Commissioner of the State of North Dakota has held that requiring Franchisees to consent to jurisdiction of courts outside of North Dakota is unfair, unjust or inequitable within the intent of Section 51-19-09 of the North Dakota Investment Law.
The site of mediation or arbitration shall be agreeable to all parties; therefore, this provision is amended to provide that the state of mediation or arbitration shall be agreeable to all parties;
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Boulder Designs' 2025 Franchise Disclosure Document, the location for mediation or arbitration is subject to agreement by all involved parties. However, this is specifically in reference to franchisees in North Dakota.
For prospective Boulder Designs franchisees in North Dakota, this means that the standard clause in the franchise agreement requiring disputes to be resolved in McLennan County, Texas, is not enforceable. Instead, the location for mediation or arbitration must be mutually agreed upon. This amendment is due to the North Dakota Securities Commissioner's view that requiring franchisees to consent to jurisdiction outside of North Dakota is unfair and unjust under North Dakota's Franchise Investment Law.
For franchisees outside of North Dakota, the FDD does not specify where mediation is required to take place. A prospective franchisee should consult the franchise agreement and/or ask the franchisor directly about the required location for mediation or arbitration, as it may differ from the condition applied to North Dakota.