Under what circumstances can Bumper Man pursue claims in court instead of arbitration?
Bumper_Man Franchise · 2025 FDDAnswer from 2025 FDD Document
(2) Exception of Claims Subject to Arbitration. Franchisor and Franchisee recognize and agree that certain claims of Franchisor may not be best suited to determination through arbitration and agree that Franchisor, at its sole option, may bring the following types of
claims, cases, disputes and causes of action either in court or in arbitration:
(A) Claims seeking injunctive or other equitable relief to enforce provisions of this Agreement, provided however that non-equitable claims joined with any injunctive claims must be heard separately in arbitration, and that regardless of the forum, any injunctive relief may be given without the necessity of Franchisor posting bond or other security and any such bond or other security is hereby waived; further, Franchisee acknowledges that the termination of any litigation for injunctive or other equitable relief will not bar Franchisor from asserting non-equitable claims in an arbitration involving the same parties or causes of action;
(B) Claims seeking relief of any kind with respect to Franchisee's violation of any health or safety law;
(C) Claims seeking relief of any kind with respect to Franchisee's use of the Marks;
(D) Claims seeking relief related to of any of the provisions of Section 17 of the Franchise Agreement, including without limitation for breach of confidentiality and non-competition provisions;
(E) Claims related to unauthorized or improper use or misappropriation of Franchisor's Marks, trade secrets, Confidential Information or any of Franchisor's Intellectual Property; and/or;
Source: Item 23 — RECEIPTS (FDD pages 45–180)
What This Means (2025 FDD)
According to Bumper Man's 2025 Franchise Disclosure Document, while the standard process is binding arbitration in Dallas, Texas, Bumper Man retains the option to pursue certain claims in court. Specifically, Bumper Man can bring claims seeking injunctive or other equitable relief to enforce the provisions of the Franchise Agreement in court. However, any non-equitable claims associated with these injunctive claims must be addressed separately through arbitration. It is important to note that Bumper Man is not required to post a bond or security for any injunctive relief obtained.
Additionally, Bumper Man may pursue claims in court related to a franchisee's violation of health or safety laws, misuse of Bumper Man's trademarks, or violations of the confidentiality and non-competition provisions outlined in Section 17 of the Franchise Agreement. This also extends to claims concerning the unauthorized or improper use or misappropriation of Bumper Man's marks, trade secrets, confidential information, or any of its intellectual property.
Furthermore, if the binding arbitration provisions within the agreement are deemed unenforceable for any reason, the designated forum for resolving arbitrable claims becomes the United States District Court for the Northern District of Texas, Dallas Division. If the federal court lacks jurisdiction, the claim will be addressed by the District Court of Dallas County, Texas. This clause does not apply to claims for temporary injunctive relief pending arbitration.
This ability for Bumper Man to pursue specific claims in court offers the franchisor more flexibility in protecting its brand, intellectual property, and adherence to critical regulations. However, franchisees should be aware of these conditions and understand that while arbitration is the standard, certain violations can lead to court proceedings.