Can the Cool Binz Franchisor specifically enforce its rights to arbitration?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
Arbor, Michigan under the auspices of the American Arbitration Association ("AAA"), in accordance with AAA's Commercial Arbitration Rules then in effect, with an arbitrator with at least five (5) years of franchise law experience. We may specifically enforce our rights to arbitration. Each party shall bear its own cost of arbitration and you and we shall share costs of the arbitrator equally. This agreement to arbitrate shall survive any termination or expiration of this Agreement.
- a. 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):
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- Any federally protected intellectual property rights in the Marks, the System, trade secrets, or Confidential Information;
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- Any claims pertaining to or arising out of any warranty issue;
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- Any of the restrictive covenants contained in this Agreement;
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- Any claims arising out of or related to fraud or misrepresentation by you or your insolvency; or
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- Any claims where the damages alleged are less than $50,000.
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- Selection of Venue. Nothing contained in this Agreement
Source: Item 23 — RECEIPTS (FDD pages 63–238)
What This Means (2025 FDD)
According to Cool Binz's 2025 Franchise Disclosure Document, Cool Binz retains the right to specifically enforce its rights to arbitration. This means that Cool Binz can compel a franchisee to resolve disputes through arbitration rather than litigation. The arbitration would take place in Ann Arbor, Michigan, under the rules of the American Arbitration Association (AAA), using an arbitrator with at least five years of franchise law experience. Both parties will bear their own costs of arbitration and share the costs of the arbitrator equally. This agreement to arbitrate survives any termination or expiration of the Franchise Agreement.
However, Cool Binz is not required to arbitrate and may initiate litigation in court for certain disputes. These include allegations that the franchisee has violated federally protected intellectual property rights in the Marks, the System, trade secrets, or Confidential Information; claims pertaining to or arising out of any warranty issue; any of the restrictive covenants contained in the Agreement; claims arising out of or related to fraud or misrepresentation by the franchisee or their insolvency; or any claims where the damages alleged are less than $50,000.
Additionally, nothing in the agreement prevents Cool Binz from seeking a writ of attachment, temporary injunction, preliminary injunction, or other emergency relief from a court to protect its interests. This ensures that Cool Binz can take immediate action to safeguard its business interests, even while arbitration is ongoing or in cases where arbitration is not required.