Specifically, what section of the Brain Balance Franchise Agreement is exempt from the one-year statute of limitations (except in California)?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Franchise Agreement (or Satellite Franchise Agreement, if different) | Summary | |
|---|---|---|---|
| u. | Dispute Resolution by Arbitration or Mediation | 20 | Subject to applicable state law, except for certain claims, all disputes must be arbitrated before the American Arbitration Association located in Wilmington, Delaware. |
| v. | Choice of Forum | 21.01 | Subject to applicable state law, Arbitration under the Federal Arbitration Act at the American Arbitration Association in Wilmington, Delaware. * Litigation must be in any court located in New Castle County in the State of Delaware. |
| w. | Choice of Law | 21.01 | Subject to applicable state law, Delaware. |
| x. | Statute of Limitations | 21.10 | Must commence any action relating to the Franchise Agreement, the relationship between you and us, or your operation of the Franchised Business within 1 year except for our rights under Section 7 of the Franchise Agreement (except in California). |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 54–61)
What This Means (2025 FDD)
According to Brain Balance's 2025 Franchise Disclosure Document, Item 17 outlines the statute of limitations for actions relating to the Franchise Agreement. Generally, franchisees must commence any action within one year. However, there is an exception: Brain Balance's rights under Section 7 of the Franchise Agreement are exempt from this one-year limitation, except in California.
This means that Brain Balance has a longer period to bring certain claims against a franchisee compared to the franchisee's ability to bring claims against Brain Balance. The specific claims that are exempt from the one-year statute of limitations are those pertaining to the franchisor's rights under Section 7 of the Franchise Agreement.
A prospective franchisee should carefully review Section 7 of the Franchise Agreement to understand what rights of Brain Balance are not subject to the one-year statute of limitations. Understanding the nature of these rights will help a franchisee assess the potential risks and liabilities associated with the franchise.