What happens to a claim against Chicken Guy that is not submitted or filed as a compulsory counterclaim?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
Chicken Guy and Franchisee further agree that, in connection with any such arbitration proceeding, each must submit or file any claim which would constitute a compulsory counterclaim (as defined by Rule 13 of the Federal Rules of Civil Procedure) within the same proceeding as the claim to which it relates.
Any such claim which is not submitted or filed as described above will be forever barred.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to the 2025 Chicken Guy Franchise Disclosure Document, any claim against Chicken Guy that is not submitted or filed as a compulsory counterclaim in an arbitration proceeding will be permanently barred. This means a franchisee could lose the right to pursue that claim in the future.
A compulsory counterclaim, as defined by Rule 13 of the Federal Rules of Civil Procedure, is a claim that a party has against an opposing party that arises out of the same transaction or occurrence as the opposing party's claim. In the context of a Chicken Guy franchise, this could include disputes related to the franchise agreement, operations, or payments.
This provision encourages franchisees to bring all related claims in a single arbitration proceeding to ensure efficiency and avoid piecemeal litigation. Failure to raise a compulsory counterclaim at the appropriate time results in a waiver of that claim, which has significant legal implications for franchisees who may have multiple issues with Chicken Guy.
Prospective franchisees should carefully consider this clause and consult with legal counsel to understand their obligations regarding compulsory counterclaims. They should also maintain thorough records of all communications and transactions with Chicken Guy to identify any potential claims that may need to be raised in an arbitration proceeding.