Where will the arbitration take place in a dispute involving Chicken Guy?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
- B. Arbitration. Subject to Section 22.A., Chicken Guy and Developer agree that all controversies, disputes, or claims between the parties and their respective affiliates, owners, shareholders, officers, directors, agents, and/or employees arising out of or related to: (1) this Agreement; (2) the relationship between the parties; (3) the scope and validity of this Agreement or any provision of this Agreement (including the validity and scope of the arbitration obligations under this Section 22.B., which the parties acknowledge is to be determined by an arbitrator and not a court); or (4) any aspect of the System or any System standard must be submitted for binding arbitration, on demand of either party, to the AAA and in accordance with its then-current rules for commercial arbitration. The arbitration proceedings will be conducted by a single arbitrator. The arbitration will take place in the city where Chicken Guy's principal offices are located at the time the demand for arbitration is filed. The arbitrator will have no authority to select a different hearing locale other than as described in the prior sentence. All matters
Source: Item 23 — RECEIPTS (FDD pages 50–286)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, arbitration proceedings will occur in the city where Chicken Guy's principal offices are located when the demand for arbitration is filed. The arbitrator does not have the authority to select a different hearing location. This applies to all disputes between Chicken Guy and the developer (franchisee), including their affiliates, owners, shareholders, officers, directors, agents, and/or employees. These disputes can arise from the Franchise Agreement, the relationship between the parties, the scope and validity of the agreement, or any aspect of the Chicken Guy system.
This means that if a franchisee has a dispute with Chicken Guy that cannot be resolved through mediation, the franchisee may be required to travel to the city where Chicken Guy's principal offices are located for arbitration. This could create a financial burden for the franchisee, especially if they are located far from Chicken Guy's headquarters. Franchisees should factor in potential travel costs and logistical challenges when evaluating the franchise opportunity.
It is also important to note that all matters relating to arbitration will be governed by the Federal Arbitration Act and not by any state arbitration law. This ensures a consistent legal framework for arbitration proceedings, regardless of the franchisee's location. However, franchisees should be aware of the implications of the Federal Arbitration Act and how it may affect their rights in a dispute with Chicken Guy.
Prospective franchisees should confirm the location of Chicken Guy's principal offices and consider the potential costs and inconveniences associated with traveling to that location for arbitration. They should also consult with an attorney to understand their rights and obligations under the Federal Arbitration Act and the Franchise Agreement.