Who is responsible for paying the costs and expenses of a legal suit regarding a Crave Cookies dispute?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
If the mediation has not resolved the matter successfully, or mediation is waived, either Franchisee or Crave Cookies Franchising may institute a legal suit, action, or proceeding, exclusively in the city and state of Crave Cookies Franchising's then-current headquarters, against the other party to enforce this Agreement or obtain any other remedy regarding any breach of this Agreement.
The prevailing party in the suit, action, or proceeding is entitled to receive, and the non-prevailing party shall pay, in addition to all other remedies to which the prevailing party may be entitled, the costs and expenses incurred by the prevailing party in conducting the suit, action, or proceeding, including attorneys' fees and expenses and court costs, even if not recoverable by law, including, but not limited to, all fees, taxes, costs, and expenses incident to appellate and post-judgment proceedings.
Source: Item 22 — CONTRACTS (FDD page 47)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, the responsibility for covering the costs and expenses of a legal suit depends on who prevails in the legal proceeding. The FDD states that the prevailing party is entitled to receive payment for the costs and expenses incurred during the suit, including attorney's fees and court costs, from the non-prevailing party. This includes costs associated with appellate and post-judgment proceedings, even if those costs are not typically recoverable by law.
This arrangement creates a financial risk for franchisees who may find themselves in a legal dispute with Crave Cookies. If the franchisee loses the suit, they will be responsible for not only their own legal expenses but also those of Crave Cookies. This could amount to a significant financial burden, especially considering that legal battles can be lengthy and costly.
However, if the franchisee wins the legal suit, Crave Cookies would be responsible for covering the franchisee's legal costs and expenses. This provides some protection for franchisees who have legitimate grievances and are willing to pursue them through legal action. It is important for prospective franchisees to carefully consider this clause and understand the potential financial implications before entering into a franchise agreement with Crave Cookies.
It is also important to note that the legal suit, action, or proceeding will be exclusively in the city and state of Crave Cookies Franchising's then-current headquarters. This means that a franchisee may have to travel to Crave Cookies' headquarters to participate in the legal proceedings. This could add to the franchisee's expenses, as they would have to pay for travel and accommodation.