If mediation fails, where must a Craters & Freighters franchisee submit their claim for arbitration?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
In the event any dispute involving a Claim is not resolved through mediation within the sixty (60) day period referenced in Section 23.2 above, Franchisee must submit such Claim to arbitration in Jefferson County or Denver County, State of Colorado, in accordance with the Commercial Arbitration Rules of the American Arbitration Association and judgment upon the award may be entered in any court having jurisdiction thereof.
The arbitration will be held before, and decided by, a panel of three (3) arbitrators.
Franchisor will select one (1) arbitrator, Franchisee will select one (1) arbitrator, and those two (2) arbitrators will then select the third arbitrator.
If the arbitrators selected by Franchisor and Franchisee cannot agree on the third arbitrator, then all three (3) arbitrators will be selected in accordance with the rules of the American Arbitration Association, which means that the arbitrators selected by Franchisor and Franchisee will not serve as arbitrators for such Claim.
The parties hereto expressly consent to personal jurisdiction in the State of Colorado and agree that such court(s) will have exclusive jurisdiction over any determination of the "prevailing party" in accordance with such issues not subject to arbitration.
- 23.3.1 Authority of Arbitrators.
The arbitrators will not have any authority to add, delete, or modify in any manner, the terms and provisions of this Agreement.
Source: Item 22 — CONTRACTS (FDD pages 49–50)
What This Means (2025 FDD)
According to the 2025 Craters & Freighters Franchise Disclosure Document, if mediation does not resolve a dispute within 60 days, the franchisee must submit the claim to arbitration in Jefferson County or Denver County, Colorado. This arbitration will follow the Commercial Arbitration Rules of the American Arbitration Association, and any judgment on the arbitration award can be entered in a court with jurisdiction.
The arbitration process involves a panel of three arbitrators. Craters & Freighters will select one arbitrator, the franchisee will select another, and those two arbitrators will then choose the third. If the two arbitrators cannot agree on the third, the American Arbitration Association's rules will govern the selection of all three arbitrators, meaning the initial selections by Craters & Freighters and the franchisee will not serve as arbitrators.
The FDD specifies that the arbitrators are not authorized to alter or modify the terms of the franchise agreement. Furthermore, both parties consent to personal jurisdiction in Colorado, and Colorado courts will have exclusive jurisdiction over determining the "prevailing party" in matters not subject to arbitration. This clause ensures that legal disputes are handled within a defined legal framework and that the arbitrator's role is limited to interpreting the existing agreement, not rewriting it.