Under whose auspices must mediation be conducted for Expense Reduction Analysts disputes?
Expense_Reduction_Analysts Franchise · 2025 FDDAnswer from 2025 FDD Document
dispute, select a way of resolving the dispute and explain why that way of resolving the dispute can be said to be a fair resolution of the dispute and identify, if the dispute is resolved, how the resolution of the dispute has or could enhance the business relationship between the parties for the future, particularly by identifying specific means of avoiding similar disputes arising between the parties in the future.
28.2 Mediation
- (1) If the dispute is not resolved in accordance with Section 29.1(3) within three (3) weeks, the Franchisor has the option to refer the matter to a mediator for mediation.
- (2) The mediation must be conducted in Dallas, Texas, under the auspices of the American Arbitration Association ("AAA"), in accordance with AAA's Commercial Mediation Rules then in effect.
- (3) The parties must attend any mediation instituted under this Section and try to resolve the dispute. The parties are equally liable for the costs of mediation unless they otherwise agree. The parties must pay their own costs of attending the mediation.
- (4) You may not commence any action against the Franchisor or its affiliates with respect to any such claim or dispute in any court unless the Franchisor fails to exercise its option to submit such claim or dispute to mediation, or such mediation proceedings have been terminated either: (i) as the result of a written declaration of the mediator(s) that further mediation efforts are not worthwhile; or (ii) as a result of a written declaration by the Franchisor. The Franchisor's rights to mediation, as set forth herein, may be specifically enforced by the Franchisor.
Source: Item 23 — RECEIPTS (FDD pages 58–215)
What This Means (2025 FDD)
According to Expense Reduction Analysts' 2025 Franchise Disclosure Document, if mediation is required to resolve a dispute, it must be conducted under the auspices of the American Arbitration Association (AAA). The mediation proceedings must take place in Dallas, Texas, and adhere to the AAA's Commercial Mediation Rules that are in effect at the time.
Both Expense Reduction Analysts and the franchisee are obligated to attend any mediation sessions and make an effort to resolve the dispute. Unless otherwise agreed, the costs associated with the mediation are to be shared equally between the parties. Each party is responsible for covering their own expenses related to attending the mediation.
It's important to note that neither party can initiate legal action against the other in court regarding any claim or dispute unless Expense Reduction Analysts chooses not to exercise its option to submit the matter to mediation. Legal action can also be pursued if the mediation proceedings are terminated, either by a written declaration from the mediator stating that further efforts are not worthwhile or by a written declaration from Expense Reduction Analysts. Expense Reduction Analysts retains the right to specifically enforce its mediation rights.
However, there are exceptions where mediation is not required before pursuing other legal avenues. These exceptions include controversies, disputes, or claims concerning allegations that a party has violated or threatens to violate federally protected intellectual property rights related to the Trademarks, the ERA System, or any Confidential Information. Additionally, disputes related to restrictive covenants within the agreement or any payment obligations of the franchisee under the agreement are also exempt from the mandatory mediation requirement.