What happens to a claim that should have been a compulsory counterclaim but wasn't in a Chicken Guy arbitration?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
Chicken Guy and Developer 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 23 — RECEIPTS (FDD pages 50–286)
What This Means (2025 FDD)
According to the 2025 Chicken Guy Franchise Disclosure Document, if a claim that qualifies as a compulsory counterclaim under Rule 13 of the Federal Rules of Civil Procedure is not submitted or filed in an arbitration proceeding, it will be permanently barred. This means a Chicken Guy franchisee or Chicken Guy itself, must bring all related claims in the initial arbitration.
This requirement is significant because it compels both Chicken Guy and the franchisee to present all relevant claims at once, preventing piecemeal litigation and promoting efficiency in dispute resolution. Failing to raise a compulsory counterclaim in the initial arbitration effectively waives the right to pursue that claim in any future proceeding.
For a prospective Chicken Guy franchisee, this underscores the importance of thoroughly assessing all potential claims against Chicken Guy before entering arbitration. It would be prudent to consult with an attorney to identify and properly assert any compulsory counterclaims to avoid losing the opportunity to pursue them later. This also highlights the importance of carefully documenting all interactions and issues that could potentially lead to a dispute with Chicken Guy.