Prior to initiating litigation, what is Buona's required dispute resolution process?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
12.1 Mandatory Mediation.Except as otherwise specifically provided herein, prior to the initiation of litigation by either party pursuant to this Agreement, the parties must make a good faith effort to resolve any controversies between them by non-binding mediation either through a mutually acceptable mediator or through an established mediation service selected by Franchisor (in either case, "Mediator"). Mediation shall take place in the Cook County, Illinois. Prior to mediation, each party involved in mediation shall sign the standard confidentiality agreement reasonably required by Mediator or a confidentiality agreement reasonably required by Franchisor if the Mediator does not have a standard confidentiality agreement. No litigation proceeding may be commenced until the earlier of thirty (30) days from the selection of the Mediator, or the mutual agreement by both parties that mediation has been unsuccessful, or if the notified party fails to respond to the requesting party within thirty (30) days of the delivery of notice requesting mediation. The parties will share equally all fees and expenses of the mediator, and each part shall bear its own costs otherwise. Each party hereby agrees that all statements made in the course of mediation shall be strictly confidential, and shall not be disclosed to or shared with any third parties, other than the mediator. Each party also agrees that any documents or data specifically prepared for use in good faith negotiations and/or mediation shall not be disclosed to or shared with any third party except those parties whose presence is necessary to facilitate the mediation process. The parties agree not to make copies of any such documents, and to return them to the other party upon the conclusion of the mediation. Each party agrees and acknowledges that no statements made in, or evidence specifically prepared for mediation shall be admissible for any purpose in any subsequent proceedings. Notwithstanding the foregoing,
Franchisor shall have no obligation to mediate claims that are the subject of Paragraph 12.2 herein.
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, before starting any lawsuits related to the franchise agreement, both Buona and the franchisee must first try to resolve the issue through non-binding mediation. This means that both parties must participate in good faith with a mediator to find a solution.
The mediation will take place in Cook County, Illinois, and both parties must sign a confidentiality agreement. This agreement ensures that all discussions and documents shared during mediation remain private. Neither party can start a lawsuit until at least 30 days have passed since the mediator was selected, or if both parties agree that the mediation is not working, or if one party doesn't respond to the mediation request within 30 days.
The costs for the mediator are split equally between Buona and the franchisee, but each party is responsible for their own additional expenses, such as attorney fees. All statements and documents prepared for the mediation are confidential and cannot be used in any later legal proceedings. However, Buona is not required to participate in mediation for claims that are subject to paragraph 12.2, which covers specific performance and injunctive relief related to the use of their trademarks and non-competition obligations.