Is mediation binding for disputes related to a Brueggers Bagels franchise?
Brueggers_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Development Agreement | Summary |
|---|---|---|
| u. Dispute resolution by arbitration | Section 20.3 | Before bringing an action in court, the parties must first submit the dispute to non-binding mediation (except for injunctive relief) in Colorado (subject to applicable state law).as req |
| Provision | Section in Franchise Agreement or License Agreement | Summary |
| --- | --- | --- |
| u. Dispute resolution by arbitration | Section 28.3 of the Franchise Agreement; Section 14.8 of the License Agreement | Before bringing an action in court, the parties must first submit the dispute to non-binding mediation (except for injunctive relief) in Colorado (subject to applicable state law). |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 49–54)
What This Means (2025 FDD)
According to Brueggers Bagels's 2025 Franchise Disclosure Document, dispute resolution requires non-binding mediation before bringing an action to court. Specifically, both the Development Agreement and the Franchise Agreement stipulate that before a franchisee can file a lawsuit, they must first submit the dispute to non-binding mediation in Colorado. This requirement is subject to applicable state law and does not apply to requests for injunctive relief.
This means that if a Brueggers Bagels franchisee has a dispute with the franchisor, they are obligated to attempt to resolve it through mediation before pursuing legal action in court. However, the outcome of the mediation is not binding, meaning that either party can still proceed to court if they are not satisfied with the results of the mediation. This process aims to encourage parties to resolve disputes amicably and potentially avoid the costs and time associated with litigation.
The FDD also specifies that any litigation must be filed in the jurisdiction where Brueggers Bagels has its principal place of business, which is Denver, Colorado, as of the date of the disclosure document. Furthermore, the laws of Colorado govern the agreements, subject to state law. These provisions ensure that legal proceedings occur in a location and under laws familiar to Brueggers Bagels, which is a common practice in franchising agreements.
It is important for prospective Brueggers Bagels franchisees to understand that while mediation is required, it is not binding, and they may still need to pursue legal action if mediation is unsuccessful. Franchisees should also be aware that they may incur travel costs to attend mediation in Colorado and should consult with a legal professional to understand their rights and obligations under the franchise agreement and applicable state laws.