Can a Buona developer commence arbitration with a third party against the Franchisor?

According to Buona's 2025 Franchise Disclosure Document, a developer is restricted from starting arbitration with a third party against Buona. Similarly, a developer cannot join a third party in any arbitration involving Buona and the developer. This clause is designed to ensure that arbitration remains solely between Buona and its developers, preventing complications that could arise from involving outside parties.

This limitation aims to streamline dispute resolution and maintain clarity in legal proceedings. By preventing developers from initiating arbitration with third parties against Buona, the franchise avoids potentially complex and protracted legal battles. This restriction helps Buona manage and control the arbitration process more effectively, focusing on direct disputes with its developers.

However, there are exceptions. If a developer is controlled by, controls, or is working in concert with another Buona developer, or if there's a guarantor of the developer's obligations to Buona, then joining those parties in arbitration between Buona and the developer is allowed. Additionally, an owner, director, officer, member, manager, partner, or other representative or agent of either Buona or the developer can be joined in arbitration proceedings. These exceptions provide some flexibility while still maintaining the primary focus on disputes directly involving Buona and its developers.

Prospective Buona franchisees should be aware of these limitations and exceptions regarding arbitration. Understanding these terms is crucial for assessing the potential legal risks and obligations associated with becoming a Buona developer. Franchisees should seek legal counsel to fully understand the implications of these arbitration clauses and how they might affect their rights and responsibilities.