For actions not subject to mandatory arbitration, to which courts does the Cinnaholic developer submit jurisdiction?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
FOR ACTIONS THAT ARE NOT SUBJECT TO MANDATORY ARBITRATION UNDER SECTION 21.2, THE DEVELOPER HEREBY SUBMITS AND IRREVOCABLY CONSENTS TO THE EXCLUSIVE JURISDICTION OF THE FEDERAL AND STATE COURTS FOR THE DISTRICT WHERE FRANCHISOR'S PRINCIPAL EXECUTIVE OFFICE IS LOCATED ON THE DATE OF FILING OF THE ACTION AND AGREES NOT TO RAISE, AND HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION BASED UPON FORUM NON CONVENIENS OR ANY OTHER OBJECTION IT MAY NOW HAVE OR HEREAFTER HAVE TO SUCH JURISDICTION OR VENUE.
FURTHER, NOTHING HEREIN CONTAINED SHALL BAR FRANCHISOR'S RIGHT TO OBTAIN INJUNCTIVE RELIEF AGAINST THREATENED CONDUCT THAT WILL CAUSE IRREPARABLE HARM, UNDER THE USUAL EQUITY RULES INCLUDING THE APPLICABLE RULES FOR OBTAINING SPECIFIC PERFORMANCE, RESTRAINING ORDERS AND PRELIMINARY INJUNCTIONS.
Source: Item 23 — RECEIPT (FDD pages 62–269)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, the developer submits to the exclusive jurisdiction of the federal and state courts located in the district where Cinnaholic's principal executive office is located at the time the action is filed, for actions not subject to mandatory arbitration. The developer also agrees not to raise any objection based on forum non conveniens or any other objection to such jurisdiction or venue, waiving these objections to the fullest extent permitted by law.
This means that if a Cinnaholic developer (franchisee) has a legal dispute with Cinnaholic that is not subject to arbitration, the lawsuit must be filed in the federal or state courts within the district where Cinnaholic's main office is located. The franchisee cannot argue that the location is inconvenient or inappropriate. This clause ensures that Cinnaholic can manage legal disputes in a location convenient for them.
However, the document also states that Cinnaholic retains the right to seek injunctive relief against threatened conduct that could cause irreparable harm, under the usual equity rules, including those for specific performance, restraining orders, and preliminary injunctions. This allows Cinnaholic to take immediate legal action to prevent potential damage to their brand or business, regardless of the arbitration clause.