What is the consequence of failing to submit a dispute to Mediation prior to commencing any litigation or arbitration proceeding against Buildingstars?

According to Buildingstars's 2025 Franchise Disclosure Document, if a franchisee fails to submit a dispute to mediation before starting any litigation or arbitration proceedings, it can result in the dismissal of those proceedings. This requirement is in place to encourage dispute resolution through mediation before resorting to more formal and costly legal actions.

Specifically, Buildingstars requires that before a franchisee can bring a case to court regarding any dispute arising from the franchise agreement or relationship, the parties must first attempt to resolve the issue through a conference. If that doesn't work, the dispute must be submitted to nonbinding mediation in St. Louis County, Missouri, unless both parties agree to a different location. The franchisee is responsible for covering the costs of the mediation, including the mediator's fees and expenses.

This mediation clause is a standard practice in franchising, intended to save both parties time and money by resolving disputes amicably. However, the franchisee bears the cost of mediation, which may be a financial burden. It's also important to note that Buildingstars can pursue certain claims, such as those related to trademarks or intellectual property, or requests for injunctive relief, without being bound by the mediation requirement.