What is the condition that must be met before litigation is permitted for Ella Cafe disputes?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
If agreement cannot be reached within 15 days after either party has notified the other of its desire to seek mediation, then mediation will occur with the American Arbitration Association or any successor organization ("AAA") in accordance with its rules governing mediation.
Mediation will be held at the offices of the AAA in the city where Franchisor's principal business office is located at the time of the mediation.
The costs and expenses of mediation paid to the AAA or to the mediator will be paid equally by the parties.
All other mediation-related expenses, including but not limited to, attorneys' fees and travel expenses, will be paid by the party which incurred such expense.
- 14.2.3.
If the parties are unable to resolve the claim, controversy, or dispute within 90 days after the mediator has been chosen, then, unless such time period is extended by written agreement of the parties, either party may institute legal proceedings pursuant to Section 14.3.
The parties agree that statements made during such mediation proceeding will not be admissible for any purpose in any subsequent legal proceeding.
- 14.2.4.
Notwithstanding the foregoing provisions of this Section 14.2., the parties' agreement to mediate will not apply to controversies, disputes, or claims relating to or based on past due amounts owed to Franchisor pursuant to this Agreement, the Marks, Copyrighted Works, or Franchisor's Confidential Information.
Moreover, regardless of this mediation agreement, Franchisor and Developer each have the right in a proper case to seek temporary restraining orders and temporary or preliminary injunctive relief in any court of competent jurisdiction.
Source: Item 23 — RECEIPTS (FDD pages 50–181)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, before initiating litigation, both parties must first attempt to resolve the dispute through mediation. If an agreement cannot be reached within 15 days of either party expressing the desire for mediation, the mediation will proceed under the rules of the American Arbitration Association (AAA).
The mediation will take place at the AAA's offices in the city where Ella Cafe's main business office is located. The costs associated with the mediator and the AAA will be split equally between the parties, while each party will cover their own additional expenses, such as attorney fees and travel costs.
If the dispute remains unresolved 90 days after the mediator is chosen, either party is then permitted to start legal proceedings, unless both parties agree to extend this period in writing. However, this mediation requirement does not apply to claims regarding past due amounts owed to Ella Cafe, or disputes concerning the brand's trademarks, copyrighted works, or confidential information. Additionally, both Ella Cafe and the developer retain the right to seek temporary restraining orders or injunctive relief in court, regardless of the mediation agreement.