Must a Counselor Realty franchisee arbitrate disputes individually?
Counselor_Realty Franchise · 2025 FDDAnswer from 2025 FDD Document
- 10.1 Arbitration. Except as provided below, any dispute arising under or in relation to this Agreement shall be resolved by binding arbitration by the National Center for Dispute Settlement, under its rules for expedited commercial arbitration, in Minneapolis, Minnesota. Each claim or controversy will be arbitrated by Franchisee on an individual basis, and will not be consolidated in any arbitration action with the claim of any other franchisee. The award of the arbitrators is final and binding on all parties. The arbitrators may issue appropriate orders as well as award monetary (but not exemplary or punitive) damages. The prevailing party will be entitled to recover its costs including its reasonable attorneys' fees. We may sue to collect money owed to us, to protect or enforce our rights in the Marks, or to compel inspections or audits.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 25–29)
What This Means (2025 FDD)
According to Counselor Realty's 2025 Franchise Disclosure Document, any disputes arising under the Franchise Agreement must be resolved through binding arbitration in Minneapolis, Minnesota. The arbitration will be conducted by the National Center for Dispute Settlement, following its rules for expedited commercial arbitration.
Specifically, each Counselor Realty franchisee must pursue their claims on an individual basis. The FDD states that a franchisee's claim or controversy will not be consolidated with the claim of any other franchisee in any arbitration action. This means a franchisee cannot join a class action arbitration against Counselor Realty; they must arbitrate their dispute separately.
The arbitrator's award is considered final and binding. The arbitrator can issue orders and award monetary damages, but is not allowed to award exemplary or punitive damages. The prevailing party in the arbitration is entitled to recover their costs, including reasonable attorney's fees.
There are some exceptions to the arbitration requirement. Counselor Realty retains the right to sue a franchisee in court to collect money owed, to protect its trademark rights, or to compel inspections or audits. Additionally, Counselor Realty can seek injunctive relief in court for breaches of the Franchise Agreement that could cause irreparable harm.