Can arbitration for a Coffee News franchise agreement take place outside of Illinois?
Coffee_News Franchise · 2025 FDDAnswer from 2025 FDD Document
Addendum No.1 for the State of Illinois
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- Illinois law governs the Franchise Agreement.
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- In conformance with Section 4 of the Illinois Franchise Disclosure act, any provision in a franchise agreement that designates jurisdiction and venue in a forum outside of the State of Illinois is void. However, a franchise agreement may provide for arbitration to take place outside of Illinois.
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- Your rights upon Termination and Non-Renewal of an agreement are set forth in sections 19 and 20 of the Illinois Franchise Disclosure Act.
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- In conformance with section 41 of the Illinois Franchise Disclosure Act, any condition, stipulation or provision purporting to bind any person acquiring any franchise to waive compliance with the Illinois Franchise Disclosure Act or any other law of Illinois is void.
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- No statement, questionnaire or acknowledgement signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of: (i) waiving any claims under any applicable state franchise law, including fraud and in the inducement, or (ii)disclaiming reliance on behalf of the Franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
Source: Item 23 — Receipts (FDD pages 36–118)
What This Means (2025 FDD)
According to the 2025 Coffee News Franchise Disclosure Document, for franchisees in Illinois, the franchise agreement may allow for arbitration to occur outside of the state. This is explicitly addressed in the Illinois State Addendum within the FDD.
This means that if a Coffee News franchisee in Illinois has a dispute with the franchisor that goes to arbitration, the proceedings might not necessarily be held in Illinois. The specific location for arbitration is detailed elsewhere in the agreement, which states that arbitration proceedings shall be conducted in Bangor, Maine.
It is important for prospective franchisees in Illinois to understand that while Illinois law generally voids provisions that designate jurisdiction and venue outside of Illinois, there is an exception for arbitration. Therefore, franchisees should be prepared to potentially travel to Bangor, Maine, for arbitration proceedings, which could incur additional costs for travel and legal representation.