Does the requirement to mediate Bumper Man disputes bar either party from obtaining injunctive relief?
Bumper_Man Franchise · 2025 FDDAnswer from 2025 FDD Document
Notwithstanding anything to the contrary, this Section 24(a) will not bar either Party from obtaining injunctive relief pursuant to Section 24(c)(2)(A) against threatened conduct that will cause it to incur Losses and Expenses, under the usual equity rules, including the applicable rules for obtaining restraining orders and injunctions, without having to engage in mediation. In addition, this Section 24(a) will not apply to any claim or dispute relating to Franchisee's failure to make payments for Continuing Service Fees or other amounts owed to Franchisor under this Agreement. Franchisor and Franchisee will each bear their own costs of mediation, and each will bear one-half the cost of the mediator or mediation service.
Source: Item 23 — RECEIPTS (FDD pages 45–180)
What This Means (2025 FDD)
According to the 2025 Bumper Man Franchise Disclosure Document, the requirement to participate in non-binding mediation before bringing legal action does not prevent either party from seeking injunctive relief under specific circumstances. Specifically, either Bumper Man or the franchisee can pursue injunctive relief against threatened conduct that would cause them to incur losses and expenses, without first engaging in mediation. This ability to seek injunctive relief is subject to standard equity rules, including those for obtaining restraining orders and injunctions.
This exception to the mediation requirement provides a crucial safeguard for both Bumper Man and its franchisees. Injunctive relief is typically sought when immediate and irreparable harm is likely to occur if certain actions are not stopped. For example, Bumper Man might seek an injunction to prevent a franchisee from using its trademarks improperly, or a franchisee might seek an injunction to prevent Bumper Man from violating the terms of the franchise agreement in a way that would immediately damage their business.
Furthermore, the mediation requirement does not apply to claims or disputes regarding the franchisee's failure to make payments for continuing service fees or other amounts owed to Bumper Man under the Franchise Agreement. This means Bumper Man can immediately pursue legal action to recover unpaid fees without first going through mediation. Both Bumper Man and the franchisee are responsible for their own mediation costs, and they will equally share the costs of the mediator or mediation service.
This clause ensures that critical issues requiring immediate action can be addressed promptly through the courts, while still encouraging mediation as a first step for resolving other disputes. Prospective franchisees should understand these provisions and consider seeking legal counsel to fully grasp their rights and obligations regarding dispute resolution.