Does the requirement for non-binding mediation apply to claims related to a Casiola Franchisee's breach of contract that may entitle the Franchisor to injunctive relief?
Casiola Franchise · 2024 FDDAnswer from 2024 FDD Document
Notwithstanding the preceding paragraph, Franchisor and Franchisee agree this Sub-Article 18.G.(1) and, thereby, the prerequisite requirement of non-binding mediation, shall not, at Franchisor's election, apply to: (a) any claims or disputes related to or concerning a breach of this Agreement by Franchisee that, under the terms of this Agreement, may entitle Franchisor to the award of injunctive relief including, but not limited to, Franchisee's violation or purported violation of Article 6 of this Agreement; and/or (b) claims by either Franchisor or Franchisee under this Agreement that relates to either Franchisor's or Franchisee's failure to pay fees or other monetary obligations due under this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 47–209)
What This Means (2024 FDD)
According to Casiola's 2024 Franchise Disclosure Document, the requirement for non-binding mediation does not automatically apply to claims related to a franchisee's breach of contract that may entitle Casiola to injunctive relief. Casiola has the option to elect not to engage in non-binding mediation in such cases. This means that Casiola can directly pursue legal action, such as seeking an injunction, against a franchisee without first going through mediation.
This waiver of mediation applies specifically to breaches of the franchise agreement by the franchisee that could lead to Casiola seeking injunctive relief. An example provided in the FDD is a franchisee's violation of Article 6 of the agreement, which likely covers proprietary or confidential information. Additionally, Casiola can bypass mediation for claims regarding the franchisee's failure to pay fees or other monetary obligations.
For a prospective Casiola franchisee, this means that in certain situations, disputes may escalate more quickly to legal action. While mediation offers a chance to resolve issues amicably and potentially at a lower cost, Casiola reserves the right to bypass this step in cases where they believe immediate injunctive relief is necessary to protect their interests. Franchisees should be aware of this provision and understand the circumstances under which Casiola might choose to forgo mediation.