Which article of the Chocolate Fish Coffee Franchise Agreement applies to dispute resolution in the Guaranty?

According to the 2024 Chocolate Fish Coffee Franchise Disclosure Document, Article 17 of the Franchise Agreement, which pertains to dispute resolution, is applicable to and incorporated into the Guaranty. This means that the dispute resolution processes outlined in Article 17 of the Franchise Agreement will govern any disputes arising under the Guaranty as if they were fully detailed within the Guaranty itself.

Article 17 specifies that any controversy or claim between the parties, including those related to the Franchise Agreement or its formation, will be resolved through arbitration administered by the American Arbitration Association, following its Commercial Arbitration Rules. This includes the Optional Rules for Emergency Measures of Protection. The arbitration will take place in the city and state where Chocolate Fish Coffee's headquarters are located. However, either party can seek injunctive relief from the arbitrator or interim injunctive relief from a court without waiving their right to arbitrate, and claims involving intellectual property infringement can be brought in a court authorized to hear such claims.

The article also emphasizes confidentiality in all arbitration or lawsuit documents, information, and results, except when required by law or for Chocolate Fish Coffee to comply with franchise sale regulations. Both Chocolate Fish Coffee and the franchisee are expected to continue performing their obligations under the Franchise Agreement during any arbitration or litigation process, unless the agreement has been terminated.

Furthermore, Article 17 includes waivers of class actions, meaning claims must be resolved on an individual basis, and imposes a time limitation of two years for initiating arbitration or legal action from the date the conduct or event forming the basis of the claim is discovered. This time limit does not apply to claims related to non-payment, indemnity, or unauthorized use of confidential information or the Chocolate Fish Coffee marks. For legal proceedings not subject to arbitration, venue is specified as the United States District Court or the state court of record where Chocolate Fish Coffee's headquarters is located, and the non-prevailing party is responsible for covering the prevailing party's legal costs, including attorney fees.