Who bears the costs of arbitration for the Brain Balance Franchise Agreement?

According to Brain Balance's 2025 Franchise Disclosure Document, specifically the California Addendum, in the event of binding arbitration, each party involved will bear their own costs. The arbitration is set to occur in Wilmington, Delaware. This means that franchisees operating Brain Balance centers in California are responsible for covering their individual expenses related to the arbitration process, including legal representation and any associated fees.

This arrangement could potentially create a financial burden for franchisees, especially if the arbitration is lengthy or complex. Franchisees should factor in these potential costs when evaluating the franchise opportunity and consider consulting with legal counsel to understand the implications of the arbitration clause.

It is also important to note that the California Addendum highlights the importance of franchisees seeking independent legal counsel to determine the applicability of Delaware and federal laws to any provisions of the franchise agreement that restrict venue to a forum outside the State of California. This suggests that the enforceability and interpretation of the arbitration clause may be subject to legal scrutiny, and franchisees should be aware of their rights and options under both California and federal law.