Where should any contest of the arbitrator's award be held for a Coffee News franchise?
Coffee_News Franchise · 2025 FDDAnswer from 2025 FDD Document
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, except for actions seeking injunctive relief, will be conducted through the American Arbitration Association office nearest to the franchisor. The document specifies that such arbitration proceedings will take place in Bangor, Maine. This means that any disputes arising under the Franchise Agreement between Coffee News and a franchisee will be resolved through arbitration in Bangor, Maine, unless the matter involves seeking an immediate court order to prevent irreparable harm.
This requirement to arbitrate in Bangor, Maine, has significant implications for prospective franchisees. Franchisees may incur travel, accommodation, and legal costs associated with attending arbitration hearings in Bangor, Maine, regardless of where their franchise is located. This could create a financial burden, especially for franchisees located far from Maine.
It is important to note that each party is responsible for their own attorneys' fees and expenses related to the arbitration. While the administrative costs of the arbitration, including the arbitrator's fees, are to be shared equally between Coffee News and the franchisee, the franchisee still faces potentially significant costs to resolve disputes through arbitration in a location chosen by the franchisor.
Prospective franchisees should carefully consider the implications of the arbitration clause, including the location and cost considerations, before investing in a Coffee News franchise. They may wish to seek legal advice to fully understand their rights and obligations under the Franchise Agreement.