Are statements made during mediation admissible in subsequent legal proceedings for Ella Cafe?

According to Ella Cafe's 2024 Franchise Disclosure Document, statements made during mediation are generally not admissible in subsequent legal proceedings. Specifically, the Franchise Agreement states that the parties agree that statements made during mediation will not be admissible for any purpose in any subsequent legal proceeding. Furthermore, any information disclosed by either party in mediation may only be used for those purposes and may not be used in any following litigation.

This provision aims to encourage open and honest communication during mediation, without fear that these statements will be used against either party later in court. This promotes a more collaborative environment during mediation, increasing the likelihood of reaching a resolution. However, this protection does not extend to all situations.

Notably, the agreement to mediate does not apply to disputes relating to past due amounts owed to Ella Cafe, the Marks, Copyrighted Works, or Ella Cafe's Confidential Information. Also, Ella Cafe and the franchisee retain the right to seek temporary restraining orders and injunctive relief in court, regardless of the mediation agreement. Therefore, while mediation statements are generally protected, franchisees should still exercise caution and consult with legal counsel during mediation to fully understand the implications of any statements they make.