Does the Byrider agreement to arbitrate extend to disputes regarding the relationship between Byrider and the franchisee?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
f of itself or any other person (whether as an owner, employee, agent, consultant or in any other capacity), employs any person who is an employee of, or who, within one year of being hired by Franchisee, was previously employed by, the Company (or any of its affiliates) or any Byrider Business, without the written consent of the Company (or such affiliate) or such Byrider Business, then Franchisee must immediately pay an amount of damages equal to three (3) times the annual compensation of such individual to the Company (or its affiliate) or Byrider Business, as applicable.
ARTICLE XIX
ARBITRATION
19.1 Arbitration.
The parties agree that all controversies, disputes, or claims between Company and its affiliates, and their respective shareholders, officers, directors, agents, and/or employees, and Franchisee (and/or Franchisee's owners, guarantors, affiliates, and/or employees) arising out of or related to:
- (1) this Agreement or any other agreement between the parties;
- (2) Company's relationship with Franchisee;
- (3) the validity of this Agreement or any other agreement between the parties or any provision of any such agreements (including validity and scope of the arbitration
obligations under this Section, which the parties acknowledge are to be determined by an arbitrator, not a court); or
(4) any System requirement;
must be submitted for binding arbitration, on demand of either party, to Judicial Arbitration and Mediation Service ("JAMS") or its successor (or an organization designated by JAMS or its successor). All questions of arbitrability shall be determined by the arbitrator. The arbitration proceedings will be conducted by one arbitrator and, except as this Subsection otherwise provides, according to the then current arbitration rules of JAMS. All proceedings will be conducted at a suitable location chosen by the arbitrator in the Indianapolis, Indiana metropolitan area. All matters relating to arbitration will be governed by the Federal Arbitration Act (9 U.S.C. §§ 1 et seq.). Judgment upon the arbitrator's award may be entered in any court of competent jurisdiction.
Source: Item 23 — Receipts (FDD pages 88–335)
What This Means (2025 FDD)
According to the 2025 Byrider Franchise Disclosure Document, the arbitration agreement encompasses disputes regarding the relationship between Byrider and its franchisees. Specifically, all controversies, disputes, or claims between Byrider and its affiliates, and their respective shareholders, officers, directors, agents, and/or employees, and the franchisee (and/or franchisee's owners, guarantors, affiliates, and/or employees) arising out of or related to Byrider's relationship with the franchisee must be submitted for binding arbitration if either party demands it. This includes disputes related to the Franchise Agreement itself, or any other agreement between the parties.
This means that if a franchisee has a dispute with Byrider related to their franchise relationship, such as disagreements over support, training, or any other aspect of the franchise operations, the dispute will be resolved through binding arbitration rather than through the court system, if either party demands it. The arbitration will be conducted by one arbitrator according to the rules of the Judicial Arbitration and Mediation Service (JAMS) in the Indianapolis, Indiana metropolitan area, unless otherwise agreed upon. The arbitrator is responsible for determining all questions of arbitrability.
Byrider and the franchisee retain the right to seek temporary restraining orders and preliminary injunctive relief from a court of competent jurisdiction, provided that the dispute is simultaneously submitted for arbitration on the merits. The decision reached through arbitration can be entered as a judgment in any court with competent jurisdiction. This agreement to arbitrate is intended to benefit and bind certain third-party non-signatories and remains in effect even after the Franchise Agreement expires or is terminated.
This mandatory arbitration clause has significant implications for prospective Byrider franchisees. It means they are waiving their right to sue Byrider in court for many types of disputes. Arbitration is often faster and less expensive than litigation, but the arbitrator's decision is binding and there may be limited options for appeal. Franchisees should carefully consider this provision and consult with an attorney to understand the full legal ramifications before signing the Franchise Agreement.