Where will the mediation take place in a dispute between Chicken Guy and the franchisee?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
A. Mediation. 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, if a dispute arises between Chicken Guy and a franchisee, and attempts to resolve it through consultation and negotiation fail, both parties must submit to non-binding mediation. This mediation will be conducted by the American Arbitration Association (AAA) following its commercial mediation rules. Both parties are obligated to attend the mediation once a dispute is submitted, and they must sign a confidentiality agreement beforehand.
The location for this mediation is explicitly defined: it will occur in the city where Chicken Guy's principal offices are located at the time the demand for mediation is filed. This means a franchisee may be required to travel to Chicken Guy's headquarters for the mediation, regardless of the franchisee's location.
If the mediation does not successfully resolve the dispute, the parties are then obligated to submit the dispute to binding arbitration, also under the rules of the AAA. The arbitration, like the mediation, will take place in the city where Chicken Guy's principal offices are located when the demand for arbitration is filed. This clause ensures that Chicken Guy maintains control over the location of dispute resolution proceedings, which could potentially create a cost and logistical disadvantage for franchisees located far from Chicken Guy's principal offices.