Where will arbitration proceedings be conducted for disputes arising under the Coffee News franchise agreement?
Coffee_News Franchise · 2025 FDDAnswer from 2025 FDD Document
- Arbitration.
Except for obtaining injunctive relief by either party against actual or threatened conduct that would cause irreparable harm to that party, all controversies, disputes or claims arising under this Agreement between Franchisor and Franchisee shall be submitted for arbitration to the Office of the American Arbitration Association nearest to Franchisor on demand of either Franchisor or Franchisee.
Such arbitration proceedings shall be conducted in Bangor, Maine.
Except as otherwise provided in this Agreement, such claims shall be heard by one arbitrator in accordance with the then Current Commercial Arbitration Rules of the American Arbitration The administrative cost of the arbitration, including the cost of the Association. arbitrator, shall be borne equally by the parties.
Each party shall be responsible for the payment of its own attorneys' fees and expenses.
Source: Item 23 — Receipts (FDD pages 36–118)
What This Means (2025 FDD)
According to the 2025 Coffee News Franchise Disclosure Document, arbitration proceedings for disputes arising under the franchise agreement will be conducted in Bangor, Maine. This means that if a franchisee has a disagreement with Coffee News that cannot be resolved through informal means, the dispute will be settled through arbitration in Bangor, Maine, rather than through a lawsuit in a traditional court.
This requirement to arbitrate in Bangor, Maine could create additional expenses for franchisees who do not live near there. Franchisees would need to factor in travel and accommodation costs when preparing for and attending arbitration hearings. The FDD also states that the administrative costs of the arbitration, including the arbitrator's cost, will be shared equally between Coffee News and the franchisee. Each party is responsible for their own attorney's fees and expenses.
Arbitration is a common method of dispute resolution in franchising, as it is generally faster and less expensive than litigation. However, the requirement to arbitrate in a specific location, such as Bangor, Maine, can be a disadvantage for franchisees who are located far from that location. Prospective franchisees should consider this factor carefully before investing in a Coffee News franchise.