On what basis will the Cinnaholic arbitration be conducted?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
ING THE SCOPE AND VALIDITY OF THE ARBITRATION OBLIGATIONS UNDER THIS SECTION, WHICH FRANCHISOR AND FRANCHISEE ACKNOWLEDGE IS TO BE DETERMINED BY AN ARBITRATOR AND NOT A COURT) SHALL BE DETERMINED BY ARBITRATION WITH THE AMERICAN ARBITRATION ASSOCIATION ("AAA") AT THE OFFICE OF THE AAA CLOSEST TO FRANCHISOR'S PRINCIPAL EXECUTIVE OFFICE ON THE DATE OF SUBMISSION OF THE MATTER TO THE AAA. SUCH ARBITRATION SHALL BE CONDUCTED BEFORE ONE ARBITRATOR CHOSEN IN ACCORDANCE WITH AAA COMMERCIAL ARBITRATION RULES. THE DECISION OF THE ARBITRATOR SHALL BE FINAL AND BINDING UPON ALL PARTIES CONCERNED. SUCH DECISION SHALL BE RENDERED WITHIN 30 DAYS OF THE CLOSE OF THE ARBITRATION HEARING RECORD. THE ARBITRATION PROCEEDING SHALL BE CONDUCTED AT THE OFFICE OF THE AAA CLOSEST TO FRANCHISOR'S PRINCIPAL EXECUTIVE OFFICE ON THE DATE OF SUBMISSION OF THE MATTER TO THE AAA. IN ANY ARBITRATION PROCEEDING, FRANCHISOR AND FRANCHISEE AGREE THAT EACH MUST SUBMIT OR FILE ANY CLAIM WHICH WOULD CONSTITUTE A COMPULSORY COUNTERCLAIM (AS DEFINED BY THE THEN CURRENT RULE 13 OF THE FEDERAL RULES OF CIVIL PROCEDURE) WITHIN THE SAME PROCEEDING AS THE CLAIM TO WHICH IT RELATES. ANY CLAIM NOT SUBMITTED OR FILED AS REQUIRED IS FOREVER BARRED. THE ARBITRATOR MAY NOT CONSIDER ANY SETTLEMENT DISCUSSIONS OR OFFERS THAT MIGHT HAVE BEEN MADE BY EITHER PARTY.
Source: Item 23 — RECEIPT (FDD pages 62–269)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, arbitration will be conducted based on the rules of the American Arbitration Association (AAA) and the United States Arbitration Act. One arbitrator, chosen according to AAA commercial arbitration rules, will preside over the proceedings, which will take place at the AAA office closest to Cinnaholic's principal executive office on the date the matter is submitted. The Federal Rules of Evidence will apply during the arbitration.
Both Cinnaholic and the franchisee must submit any claim that would constitute a compulsory counterclaim under Rule 13 of the Federal Rules of Civil Procedure within the same proceeding as the original claim. Failure to do so will result in the claim being permanently barred. The arbitrator is prohibited from considering any settlement discussions or offers made by either party.
The arbitration will be conducted on an individual basis and cannot be consolidated with any other arbitration proceeding between Cinnaholic and any other person. The arbitrator's decision is final and binding, and must be rendered within 30 days of the close of the arbitration hearing record. Judgment upon the award may be entered in any court with competent jurisdiction.