Under the Cream franchise agreement, can a claim of an unaffiliated third-party be joined with a proceeding?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
Any provisions of this Agreement below that pertain to judicial proceedings shall be subject to the agreement to arbitrate contained in this Section.
G. GOVERNING LAW.
Except to the extent governed by the United States Trademark Act of 1946 (Lanham Act, 15 U.S.C. Sections 1051 et seq.), or other United States federal law, this Agreement and any related agreements, the franchise for your Shop, and all claims arising from the relationship between us or any of our affiliates (and our and their respective owners, officers, directors, agents, representatives and employees), and you (and your owners, guarantors, affiliates, and employees), will be governed by the laws of the State of Ohio, without regard to its conflict of laws rules. Any state law regulating the offer or sale of franchises or governing the relationship of a franchisor and its franchisee, including the terms set forth on Attachment F (as applicable), will not apply unless the jurisdictional requirements of such state law are met independently without reference to this Section.
H. CONSENT TO JURISDICTION.
Subject to the obligation to arbitrate under 17.G above and the provisions below, you and your owners agree that all actions arising under this Agreement or otherwise as a result of the relationship between you and us must be commenced in the court nearest to our or, as applicable, our successor's or assign's then-current principal place of business (currently, Columbus, Ohio), and you (and each owner) irrevocably submit to the jurisdiction of that court and waive any objection you (or the owner) might have to either the jurisdiction of or venue in that court.
I. WAIVER OF PUNITIVE DAMAGES AND JURY TRIAL.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
Based on the 2025 FDD, the Cream franchise agreement does not explicitly address whether a claim of an unaffiliated third party can be joined with a proceeding. The document outlines procedures for dispute resolution, governing law, and jurisdiction, but it does not specify whether third-party claims can be included in any legal or arbitration proceedings initiated by or against the franchisee.
Item 23 details various legal aspects of the franchise agreement, including governing law, consent to jurisdiction, and waivers of punitive damages and jury trials. However, these sections focus on the relationship between the franchisor and franchisee and do not extend to scenarios involving unaffiliated third parties. The agreement specifies that Ohio law governs the agreement and any related claims, and it requires disputes to be resolved in courts nearest to Cream's principal place of business in Columbus, Ohio, subject to arbitration.
Because the FDD does not provide specific information on joining third-party claims, prospective Cream franchisees should seek clarification from the franchisor regarding this matter. Understanding the franchisor's policy on third-party claims is essential for assessing potential legal risks and liabilities associated with operating a Cream franchise.