What happens to discussions during Chatime mediation?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
- (2) The parties to the mediation agree that: everything that occurs before the mediator will be in confidence and in closed session; all discussions will be without prejudice; and no documents brought into existence specifically for the purpose of the mediation process will be called into evidence in any subsequent litigation by either of the parties.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, all discussions that occur before the mediator are confidential and in a closed session. These discussions are considered to be without prejudice, meaning they cannot be used against either party in later legal proceedings. Furthermore, any documents specifically created for the mediation process cannot be introduced as evidence in subsequent litigation by either party.
This confidentiality is intended to foster open and honest communication during the mediation process, allowing both Chatime and the franchisee to explore potential resolutions without fear of legal repercussions based on statements made during mediation. This encourages a more collaborative approach to resolving disputes, as parties can be more forthcoming about their positions and potential compromises.
This type of clause is common in franchise agreements to promote alternative dispute resolution methods like mediation. It aims to reduce the costs and time associated with litigation by creating a safe environment for negotiation. However, it's important for a prospective Chatime franchisee to understand that while mediation can be a valuable tool, the mediator does not have the power to make any decision binding on the parties to resolve the dispute. If mediation fails, the next step is typically arbitration.