Is arbitration required for Cool Binz disputes concerning federally protected intellectual property rights?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
Notwithstanding the foregoing, we shall not be required to arbitrate, and may initiate litigation in court, in accordance with the procedure set forth in Section 15 F.3, any controversy, dispute, or claim as set forth in this Section 15.F.2 if such controversy, dispute, or claim concerns an allegation that you have violated (or threaten to violate, or pose an imminent risk of violating):
Any federally protected intellectual property rights in the Marks, the System, trade secrets, or Confidential Information;
Source: Item 23 — RECEIPTS (FDD pages 63–238)
What This Means (2025 FDD)
According to the 2025 Cool Binz Franchise Disclosure Document, Cool Binz is not required to arbitrate claims regarding violations of federally protected intellectual property rights. Cool Binz can initiate litigation in court if a dispute involves an allegation that a franchisee has violated, threatens to violate, or poses an imminent risk of violating federally protected intellectual property rights related to the Marks, the System, trade secrets, or Confidential Information.
This means that Cool Binz retains the right to pursue legal action in court to protect its intellectual property, rather than being bound to arbitration. This is a common practice in franchising, as franchisors often want to have the ability to quickly and decisively protect their trademarks, systems, and confidential information through court intervention.
For a prospective Cool Binz franchisee, this clause indicates that disputes over intellectual property are more likely to be resolved in court, which can be a more formal and potentially expensive process than arbitration. However, it also means that Cool Binz is serious about protecting its intellectual property and will take swift action against any infringement. Franchisees should ensure they fully understand and comply with Cool Binz's intellectual property policies to avoid potential legal disputes.