Can proceedings between a Degree Wellness developer and franchisor be consolidated with other proceedings?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
WAIVER OF CLASS ACTIONS.
THE PARTIES AGREE THAT ALL PROCEEDINGS ARISING OUT OF OR RELATED TO THIS AGREEMENT, OR THE SALE OF THE FRANCHISED BUSINESS, WILL BE CONDUCTED ON AN INDIVIDUAL, NOT A CLASS-WIDE BASIS, AND THAT ANY PROCEEDING BETWEEN DEVELOPER, DEVELOPER'S GUARANTORS AND FRANCHISOR OR ITS AFFILIATES/OFFICERS/EMPLOYEES MAY NOT BE CONSOLIDATED WITH ANY OTHER PROCEEDING BETWEEN FRANCHISOR AND ANY OTHER THIRD PARTY.
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, proceedings between a Degree Wellness developer, their guarantors, and Degree Wellness cannot be consolidated with proceedings involving other third parties. This means that any legal actions or disputes arising from the Development Agreement or the sale of the franchised business must be handled on an individual basis.
This clause prevents a Degree Wellness developer from joining their case with other franchisees or developers who may have similar grievances against the franchisor. The intention is to ensure that each dispute is considered separately, based on its own specific facts and circumstances. This can be beneficial for Degree Wellness, as it avoids the potential for large, complex class-action lawsuits.
For a prospective Degree Wellness developer, this waiver of class actions means they will need to pursue any claims against Degree Wellness independently. This could potentially increase the legal costs and time involved in resolving disputes, as they cannot share resources or strategies with other franchisees in a consolidated action. However, it also means that the developer's case will be judged on its own merits, without being influenced by the issues or outcomes of other disputes.
It is important for a potential Degree Wellness developer to understand the implications of this clause and to consider the potential costs and risks associated with individual legal action. They should seek legal advice to fully understand their rights and obligations under the Development Agreement and to assess the potential impact of the waiver of class actions on their ability to resolve disputes with Degree Wellness.