Does the Chocolate Fish Coffee franchise agreement allow for class action lawsuits or arbitrations?
Chocolate_Fish_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
s under this Agreement during the arbitration or litigation process.
- 17.2 Damages. In any controversy or claim arising out of or relating to this Agreement, each party waives any right to punitive or other monetary damages not measured by the prevailing party's actual damages, except damages expressly authorized by federal statute and damages expressly authorized by this Agreement.
- 17.3 Waiver of Class Actions. The parties agree that any claims will be arbitrated, litigated, or otherwise resolved on an individual basis, and waive any right to act on a class-wide basis.
- 17.4 Time Limitation. Any arbitration or other legal action arising from or related to this Agreement must be instituted within two years from the date such party discovers the conduct or event that forms the basis of the arbitration or other legal action. The foregoing time limit does not apply to claims (i) by one party related to non-payment under this Agreement by the other party, (ii) for indemnity under Article 16, or (iii) related to unauthorized use of Confidential Information or the Marks.
- 17.5 Venue Other Than Arbitration. For any legal proceeding not required to be submitted to arbitration, the parties agree that any such legal proceeding will be brought in the United States District Court where Chocolate Fish Franchising's headquarters is then located. If there is no federal jurisdiction over the dispute, the parties agree that any such legal proceeding will be brought in the court of record of the state and county where Chocolate Fish Franchising's headquarters is then located. Each party consents to the jurisdiction of such courts and waives any objection that it, he or she may have to the laying of venue of any proceeding in any of these courts.
- 17.6 Legal Costs. In any legal proceeding (including arbitration) related to this Agreement or any guaranty, the non-prevailing party shall pay the prevailing party's attorney fees, costs and other expenses of the legal proceeding. "Prevailing party" means the party, if any, which prevailed upon the central litigated issues and obtained substantial relief.
ARTICLE 18. MISCELLANEOUS
18.1 Relationship of the Parties. The parties are independent contractors, and neither is the agent, partner, joint venturer, or employee of the other. Chocolate Fish Franchising is not a fiduciary of Franchisee. Chocolate Fish Franchising does not control or have the right to control Franchisee or its Business. Any required specifications and standards in this Agreement and in the System Standards exist to protect Chocolate Fish Franchising's interest in the System and the Marks, and the goodwill established in them, and not for the purpose of establishing any control, or duty to take control, over the Business. Chocolate Fish Franchising has no liability for Franchisee's obligations to any third party whatsoever.
- 18.2 No Third-Party Beneficiaries. This Agreement does not confer any rights or remedies upon any person or entity other than Franchisee, Chocolate Fish Franchising, and Chocolate Fish Franchising's affiliates.
- 18.3 Entire Agreement. This Agreement constitutes the entire agreement of the parties and supersedes all prior negotiations and representations. Nothing in this Agreement or in any related agreement is intended to disclaim the representations made by Chocolate Fish Franchising in its franchise disclosure document.
- 18.4 Modification. No modification or amendment of this Agreement will be effective unless it is in writing and signed by both parties. This provision does not limit Chocolate Fish Franchising's rights to modify the Manual or System Standards.
- **18.5 Consent;
Source: Item 23 — RECEIPTS (FDD pages 41–119)
What This Means (2024 FDD)
According to the 2024 Chocolate Fish Coffee Franchise Disclosure Document, the franchise agreement includes stipulations regarding dispute resolution, including arbitration and waivers of class actions. Specifically, any claims between the parties will be resolved on an individual basis through arbitration or litigation, and franchisees waive the right to participate in class-wide actions. This means a franchisee cannot be part of a class action lawsuit against Chocolate Fish Coffee.
Except for intellectual property claims, any controversy or claim between the parties will be resolved by arbitration administered by the American Arbitration Association in accordance with its Commercial Arbitration Rules. The location for arbitration will be the city and state where Chocolate Fish Franchising's headquarters are located. Either party may seek injunctive relief from the arbitrator or a court, without waiving the right to arbitrate, and all documents and information related to any arbitration or lawsuit will be kept confidential, unless disclosure is required by law.
For any legal proceeding not subject to arbitration, the venue will be the United States District Court where Chocolate Fish Franchising's headquarters is located, or if there is no federal jurisdiction, the court of record of the state and county where Chocolate Fish Franchising's headquarters is located. The agreement also specifies a time limitation, requiring that any arbitration or legal action related to the agreement must be initiated within two years 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 Marks.
In any legal proceeding, including arbitration, the non-prevailing party is responsible for paying the prevailing party's attorney fees, costs, and other expenses. The prevailing party is defined as the party that obtained substantial relief on the central litigated issues. These dispute resolution terms are typical in franchise agreements, as they aim to streamline conflict resolution and reduce the potential for costly class action lawsuits.