Can the arbitrator consider settlement discussions or offers made by either party in a Cream arbitration?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
We and you further agree that, in any arbitration proceeding, each party must submit or file any claim which would constitute a compulsory counterclaim (as defined by Rule 13 of the Federal Rules of Civil Procedure) within the same proceeding. Any claim which is not submitted or filed as required will be forever barred. The arbitrator may not consider any settlement discussions or offers that might have been made by either you or us.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to the 2025 FDD, when resolving disputes through arbitration, the arbitrator is specifically prohibited from considering any settlement discussions or offers made by either Cream or the franchisee. This means that any attempts to negotiate a resolution prior to the arbitration hearing will not be taken into account during the arbitration process itself.
This provision ensures that the arbitrator's decision is based solely on the merits of the case as presented during the arbitration, without being influenced by prior settlement negotiations. It encourages both parties to present their strongest case during the arbitration hearing, as previous offers or discussions will not be a factor in the arbitrator's decision.
For a prospective Cream franchisee, this means that it is important to carefully consider all aspects of the dispute and present a well-prepared case during arbitration. Franchisees should be aware that any concessions or offers made during settlement discussions will not be considered by the arbitrator, so they should focus on presenting the strongest possible arguments and evidence to support their position.