When can a party initiate arbitration against Extreme Art Studio?
Extreme_Art_Studio Franchise · 2024 FDDAnswer from 2024 FDD Document
was located or where any of your owners lives for those claims brought in accordance with this Section 17.7. The parties consent to the exercise of personal jurisdiction over them by these courts, and to the propriety of venue in these courts for the purpose of this Section 17.7, and the parties waive any objections that they would otherwise have in this regard.
- 17.8 GOVERNING LAW. ALL MATTERS RELATING TO ARBITRATION WILL BE GOVERNED BY THE FEDERAL ARBITRATION ACT (9 U.S.C. §§ 1 ET SEQ.). EXCEPT TO THE EXTENT GOVERNED BY THE FEDERAL ARBITRATION ACT, THE UNITED STATES TRADEMARK ACT OF 1946 (LANHAM ACT, 15 U.S.C. SECTIONS 1051 ET SEQ.), OR OTHER FEDERAL LAW, THIS FRANCHISE AGREEMENT, THE FRANCHISE, AND ALL CLAIMS ARISING FROM THE RELATIONSHIP BETWEEN US AND YOU WILL BE GOVERNED BY THE LAWS OF THE STATE WHERE THE EXTREME ART STUDIO BUSINESS IS LOCATED, WITHOUT REGARD TO ITS CONFLICT OF LAWS RULES, EXCEPT THAT ANY STATE LAW REGULATING THE SALE OF FRANCHISES OR GOVERNING THE RELATIONSHIP OF A FRANCHISOR AND ITS FRANCHISE OWNER WILL NOT APPLY UNLESS ITS JURISDICTIONAL REQUIREMENTS ARE MET INDEPENDENTLY WITHOUT REFERENCE TO THIS SECTION.
- 17.9 CONSENT TO JURISDICTION. SUBJECT TO SECTIONS 17.5, 17.6 AND 17.7 ABOVE AND THE PROVISIONS BELOW, WE AND YOU (AND YOUR OWNERS) AGREE THAT ALL ACTIONS ARISING UNDER THIS FRANCHISE AGREEMENT OR OTHERWISE AS A RESULT OF THE RELATIONSHIP BETWEEN YOU AND US MUST BE COMMENCED IN THE STATE OR FEDERAL COURT OF GENERAL JURISDICTION CLOSEST TO OUR THEN-CURRENT PRINCIPAL PLACE OF BUSINESS (CURRENTLY, EDEN PRAIRIE, MINNESOTA), AND WE AND YOU (AND EACH OWNER) IRREVOCABLY CONSENT TO THE EXCLUSIVE JURISDICTION OF THOSE COURTS AND WAIVE ANY OBJECTION TO EITHER THE JURISDICTION OF OR VENUE IN THOSE COURTS. NONETHELESS, WE AND YOU (AND YOUR OWNERS) AGREE THAT WE HAVE THE OPTION TO BRING SUIT AGAINST YOU IN THE COURTS OF THE STATE OR STATES IN WHICH YOU ARE DOMICILED OR THE FRANCHISED BUSINESS IS LOCATED FOR: (i) CLAIMS BROUGHT IN ACCORDANCE WITH SECTION 17.7; OR (ii) TO ENFORCE ANY ARBITRATION ORDERS AND AWARDS.
17.10 WAIVER OF PUNITIVE DAMAGES AND JURY TRIAL.
17.10.1 EXCEPT FOR YOUR OBLIGATION TO INDEMNIFY US FOR THIRD-PARTY CLAIMS UNDER SECTION 16.4, AND EXCEPT FOR PUNITIVE DAMAGES
AVAILABLE TO EITHER PARTY UNDER FEDERAL LAW, WE AND YOU (AND YOUR OWNERS) WAIVE TO THE FULLEST EXTENT PERMITTED BY LAW ANY RIGHT TO OR CLAIM FOR ANY PUNITIVE OR EXEMPLARY DAMAGES AGAINST THE OTHER AND AGREE THAT, IN THE EVENT OF A DISPUTE BETWEEN US AND YOU, THE PARTY MAKING A CLAIM WILL BE LIMITED TO EQUITABLE RELIEF AND TO RECOVERY OF ANY ACTUAL DAMAGES IT SUSTAINS.
17.10.2 WE AND YOU IRREVOCABLY WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM, WHETHER AT LAW OR IN EQUITY, BROUGHT BY EITHER OF US.
17.11 BINDING EFFECT.
Source: Item 22 — CONTRACTS (FDD page 49)
What This Means (2024 FDD)
According to the 2024 Extreme Art Studio Franchise Disclosure Document, all matters relating to arbitration will be governed by the Federal Arbitration Act. Except to the extent governed by the Federal Arbitration Act, the United States Trademark Act of 1946, or other federal law, the Franchise Agreement, the franchise, and all claims arising from the relationship between Extreme Art Studio and the franchisee will be governed by the laws of the state where the Extreme Art Studio Business is located. This is without regard to its conflict of laws rules, except that any state law regulating the sale of franchises or governing the relationship of a franchisor and its franchise owner will not apply unless its jurisdictional requirements are met independently without reference to this section.
The FDD specifies that any arbitration or mediation proceeding shall be limited to controversies between Extreme Art Studio and the franchisee. It cannot be expanded to include any other Extreme Art Studio franchisee as a party, or include the adjudication of class action claims. The arbitration proceedings and related documents are to remain confidential, except as required by applicable law, including the required disclosure in the franchise disclosure document.
Notably, Extreme Art Studio retains the right to seek provisional remedies from a court, including declaratory relief, specific performance, temporary restraining orders, or preliminary injunctions, without awaiting the outcome of any mediation or arbitration. These remedies can be sought for actions related to threatened or actual conduct causing loss or damage to Extreme Art Studio, the Marks, Confidential Information, or the System; to prohibit violations of law or dishonest/misleading conduct by the franchisee or its employees; issues concerning antitrust laws; securing injunctive relief or specific performance; the right to indemnification; actions seeking compliance with post-termination obligations; or actions involving an alleged breach of any restrictive covenant. Franchisees agree that Extreme Art Studio may obtain such injunctive relief in addition to other relief available at law or in equity.