What happens if litigation must be conducted in a state other than Texas for C12 Group?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
| u. Dispute resolution by arbitration or mediation | XII, Exhibit F | All matters can be appealed up through C12’s defined three-step dispute resolution process which culminates in Christian arbitration pursuant to which the parties engage three Bible-believing Christian arbitrators as follows: one selected by the franchisee, one selected by C12, and one selected by such two arbitrators. The remedy recommended by the arbitration panel will be binding and final with no further recourse by either party. Subject to state law. |
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| v. Choice of forum | XII, Exhibit F | Litigation must be conducted in Texas unless otherwise stated in Exhibit F for certain State Disclosures (subject to applicable state law). |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 36–40)
What This Means (2025 FDD)
According to C12 Group's 2025 Franchise Disclosure Document, litigation must generally be conducted in Texas. However, there are exceptions to this rule. The FDD states that Exhibit F for certain State Disclosures may specify otherwise, and this is subject to applicable state law. This means that depending on the state where the franchisee is located, the litigation may need to be conducted in a different forum.
For example, the North Dakota Addendum to the Franchise Agreement states that franchisees in North Dakota are not required to consent to the jurisdiction of courts in Texas and may fall under the jurisdiction of the courts in North Dakota. Similarly, the Minnesota Addendum to the Franchise Agreement indicates that C12 Group is prohibited from requiring litigation to be conducted outside Minnesota for franchises governed by Minnesota law.
Therefore, prospective C12 Group franchisees should carefully review Exhibit F and any state-specific addenda to understand the specific requirements for the choice of forum in their state. They should also consult with a legal professional to understand their rights and obligations under applicable state laws.