Where must disputes with Brueggers Bagels be submitted for non-binding mediation before bringing an action in court?

According to Brueggers Bagels' 2025 Franchise Disclosure Document, both the Development Agreement and the Franchise Agreement stipulate that disputes must first undergo non-binding mediation in Colorado before any court action can be initiated. This requirement is detailed in Section 20.3 of the Development Agreement and Section 28.3 of the Franchise Agreement, and Section 14.8 of the License Agreement. However, this mediation prerequisite does not apply to requests for injunctive relief, which can be pursued directly in court. This process is subject to applicable state laws.

For a prospective Brueggers Bagels franchisee, this means that if a disagreement arises with the franchisor, whether related to the Development Agreement or the Franchise Agreement, the franchisee is obligated to attempt to resolve the issue through mediation in Colorado before filing a lawsuit. This mediation is non-binding, meaning that neither party is forced to accept the mediator's recommendations. The location of the mediation in Colorado is significant, as it may require the franchisee to incur travel and legal expenses to participate, potentially creating a logistical and financial burden.

This dispute resolution process is fairly standard in franchising, as it encourages parties to resolve conflicts amicably and efficiently before resorting to costly and time-consuming litigation. However, the specific location for mediation can be a point of negotiation, and franchisees should consider the implications of having to mediate disputes in a location that may be distant from their business operations. Franchisees should also be aware of the exception for injunctive relief, which allows immediate court action to prevent irreparable harm, such as a breach of confidentiality or trademark infringement.