Where must litigation be conducted for C12 Group, according to the FDD?
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. |
|---|---|---|
| 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, this is subject to applicable state law, and there are exceptions for certain state disclosures as outlined in Exhibit F.
Specifically, 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. Additionally, all arbitration or mediation in North Dakota must take place at a location agreeable to all parties involved and may not be remote from the franchisee's place of business.
Furthermore, 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. These state-specific addenda highlight the importance of understanding how state laws can modify the standard franchise agreement.
Prospective franchisees should carefully review Exhibit F and any state-specific addenda to understand the specific requirements for their state. It is also advisable to consult with a legal professional to fully understand their rights and obligations regarding choice of forum and applicable state laws.