What agreement must both parties sign before participating in mediation with Chicken Guy?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
Except as provided with respect to injunctive relief as set forth in this Agreement, in the event of any dispute arising from or in connection with this Agreement or the breach thereof or the relationship of the parties, the parties shall use their best efforts to settle the dispute by consulting and negotiating with each other in good faith to attempt to reach a solution satisfactory to both parties. If these methods fail, Chicken Guy and Franchisee agree to submit any claim, controversy, or dispute arising out of this Agreement or the relationship of the parties to non-binding mediation conducted by the American Arbitration Association (the "AAA") and in accordance with its then-current rules for
commercial mediation. Once either party has submitted a dispute to mediation, the obligation to attend will be binding on both parties. Both parties must sign a confidentiality agreement before participating in any mediation proceeding. The mediation will take place in the city where Chicken Guy's principal offices are located at the time the demand for mediation is filed. If a dispute cannot be resolved through mediation, the parties agree to submit the dispute to arbitration, subject to the terms and conditions of Section 31.B.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, before participating in any mediation proceeding, both Chicken Guy and the franchisee must sign a confidentiality agreement. This requirement is part of the dispute resolution process outlined in the franchise agreement. The mediation itself is non-binding and is conducted by the American Arbitration Association (AAA) in accordance with its commercial mediation rules. The mediation will occur in the city where Chicken Guy's principal offices are located when the demand for mediation is filed.
The confidentiality agreement ensures that any information shared or discussed during the mediation remains private and protected. This encourages open and honest communication between the parties, which is essential for successful mediation. It also prevents either party from using the information disclosed during mediation against the other in future legal proceedings, should the mediation fail and the dispute proceed to arbitration or litigation.
This is a fairly standard practice in franchise agreements, as mediation is often the first step in resolving disputes. Requiring a confidentiality agreement helps to create a more conducive environment for negotiation and settlement. If mediation fails, the parties agree to submit the dispute to arbitration, subject to additional terms and conditions.