factual

Does the Burneys Sweets More agreement specify which state's arbitration laws apply?

Burneys_Sweets_More Franchise · 2025 FDD

Answer from 2025 FDD Document

ng. Therefore, the parties agree that, to the extent that any Actions cannot be resolved directly between Franchisee and Franchisor, and following compliance with the applicable mediation requirements set forth in Article 21(b)(i) above, any Action arising out of or relating to this Agreement or the making, performance, or interpretation thereof shall upon thirty (30) days written notice by either party be resolved, except as elsewhere expressly provided in this Agreement, upon application by any such party by binding arbitration in the city of Franchisor's then-current principal place of business (currently Elizabethtown, North Carolina), in accordance with the Federal Arbitration Act using the Commercial Arbitration Rules then prevailing of the American Arbitration Association, including without limitation the Optional Rules for Emergency Measures of Protection ("AAA"), and not under any state arbitration laws, and judgment on the arbitration award may be entered in any court of competent jurisdiction. The arbitrator need not be affiliated the AAA. Franchisee and Franchisor agree that arbitration shall be conducted on an individual - not a class-wide basis. The Federal Arbitration Act shall apply to all arbitration and arbitration venue questions. Any award by the arbitrator(s) shall be final, binding and nonappealable. The matter shall be heard by one arbitrator mutually selected by the parties having at least ten (10) years' experience in practicing franchise law during which franchise law is or has been their primary area of practice and shall have substantial experience in the preparation of franchise agreements and franchise disclosure documents. Franchisee understands that by agreeing to arbitrate it gives up jury and appeal and other rights it might have in court.

  • (c) Injunctive Relief. Notwithstanding the provisions of Section 21(b) above, Franchisee agrees that Franchisor, at its option, will have the right to seek preliminary injunctive relief from a court of competent jurisdiction, to restrain any conduct by Franchisee, the Owners, or the guarantors that (i) could materially damage the goodwill associated with the System, the Marks, and the Chain (including but not limited to conduct related to trademark or other intellectual property infringement), (ii) that involves the disclosure or use of Franchisor's Confidential Information, including but not limited to the Customer List and Franchised Business Data, or (iii) that relates to Franchisee's, the Owners', or a managerial employee's covenants against unfair competition or solicitation, provided that if Franchisee counters, as Franchisee may, by initiating arbitration, Franchisor agrees to arbitrate the entire dispute thereafter except preliminary injunctive relief (and permanent injunctive relief also, if Franchisee will not agree that the preliminary injunction shall remain effective indefinitely until the arbitrator shall dissolve it), leaving the court action pending, if it chooses, to facilitate enforcement. Franchisee agrees that Franchisor will not be required to post a bond to obtain any injunctive relief with respect to use of the Marks.
  • (d) Prevailing Party, Attorney's Fees and Costs.

Source: Item 22 — CONTRACTS (FDD page 50)

What This Means (2025 FDD)

According to the 2025 Burneys Sweets More FDD, the franchise agreement specifies that the Federal Arbitration Act governs arbitration matters, not any specific state arbitration laws. Any actions that cannot be resolved directly between the franchisee and Burneys Sweets More, following mediation, will be resolved through binding arbitration in Elizabethtown, North Carolina, which is the franchisor's principal place of business. This arbitration will follow the Commercial Arbitration Rules of the American Arbitration Association (AAA).

This means that disputes will be handled according to federal law and the AAA's rules, offering a standardized process. The arbitrator selected must have at least ten years of experience practicing franchise law. The decision reached through arbitration is final, binding, and non-appealable, which means franchisees waive their rights to a jury trial and appeals.

Furthermore, the Burneys Sweets More franchise agreement stipulates that the laws of North Carolina govern the interpretation and enforcement of the agreement, as well as any disputes between the parties, subject to the Federal Arbitration Act. Any legal actions brought against Burneys Sweets More must commence within one year of the event giving rise to the action, or they will be barred. This governing law clause ensures that the agreement is interpreted under North Carolina law, providing a legal framework for the franchise relationship.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.