In the event of a dispute involving Del Taco, what method of resolution is attempted before binding arbitration?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
hereby waive all questions of personal jurisdiction or venue for the purpose of carrying out this provision. Any such action shall be conducted on an individual basis, and not as part of a consolidated, common, or class action, and Franchisee and its owners waive any and all rights to proceed on a consolidated, common, or class basis.
- 17.3 Arbitration. Except as otherwise provided in this Agreement, any claim, controversy or dispute arising out of or relating to this Agreement, the Restaurant, or the relationship created by this
Agreement, including any claim by Franchisee or its owners, concerning the entry into, the performance under, or the termination of this Agreement, or any other agreement between the parties will be resolved via binding arbitration under the authority of the Federal Arbitration Act in accordance with the following provisions:
- 17.3.1 Any arbitration will be administered by the American Arbitration Association (or its successor) pursuant to its then-current commercial arbitration rules and procedures. The arbitrator will have the authority to decide issues regarding arbitrability and the scope of the arbitrator's jurisdiction. The arbitration must take place in the county in which our headquarters are located at the time of the dispute (currently Orange County, California).
- 17.3.2 Any arbitration must be on an individual basis, and not as part of a common, consolidated, or class action. The parties and the arbitrator will have no authority or power to proceed with any claim as a class action or otherwise to join or consolidate any claim with any other claim or any other proceeding involving third parties. If a court determines that this limitation on joinder of or class action certification of claims is unenforceable, then this entire commitment to arbitrate will become null and void and the parties will submit all claims to the jurisdiction of the courts.
- 17.3.3 The arbitrator must follow the law and not disregard the terms of this Agreement or its related agreements. Except as otherwise provided in this Agreement, the arbitrator will have the authority to award any interim, interlocutory, or final remedy or relief that a court of the State of California could order or grant, including, without limitation, general damages, specific performance of any obligation created under this Agreement, the issuance of an injunction or other extraordinary relief, or the imposition of sanctions for abuse or frustration of the arbitration process;
Source: Item 23 — RECEIPTS (FDD pages 59–325)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, any claim, controversy, or dispute arising out of or relating to the Franchise Agreement, the restaurant, or the relationship created by the agreement will be resolved via binding arbitration. The FDD does not state that any method of resolution is attempted before binding arbitration.
Specifically, the document states that any arbitration will be administered by the American Arbitration Association (or its successor) pursuant to its then-current commercial arbitration rules and procedures. The arbitrator has the authority to decide issues regarding arbitrability and the scope of the arbitrator's jurisdiction. The arbitration must take place in the county in which Del Taco's headquarters are located at the time of the dispute, which is currently Orange County, California.
It is important to note that any arbitration must be on an individual basis and not as part of a common, consolidated, or class action. Each party will bear their share of the costs of the arbitration proceeding, but the prevailing party will have the right to an award of its reasonable attorneys' fees and costs incurred after the filing of the demand for arbitration. Either party may file suit in a court of competent jurisdiction for the entry of temporary or preliminary injunctive relief, restraining orders, and orders of specific performance, including injunctive relief pertaining to the Developer's use of the Del Taco System, including Del Taco's trademarks and service marks. This agreement to arbitrate will survive the expiration or termination of the Franchise Agreement.