Are there any exceptions to the consent to jurisdiction outlined in the Extreme Art Studio Franchise Agreement?
Extreme_Art_Studio Franchise · 2024 FDDAnswer from 2024 FDD Document
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.
Source: Item 22 — CONTRACTS (FDD page 49)
What This Means (2024 FDD)
According to Extreme Art Studio's 2024 Franchise Disclosure Document, both the franchisee and Extreme Art Studio agree that any legal actions arising from the franchise agreement or their relationship must be initiated in the state or federal court closest to Extreme Art Studio's principal place of business, which is currently Eden Prairie, Minnesota. Both parties consent to the exclusive jurisdiction of those courts and waive any objections to jurisdiction or venue. This means that as a franchisee, you are generally agreeing to litigate disputes in Minnesota.
However, Extreme Art Studio retains the option to sue the franchisee in the courts of the state where the franchisee is domiciled or where the franchised business is located under specific circumstances. These circumstances include claims brought in accordance with section 17.7 of the franchise agreement or to enforce any arbitration orders and awards. This exception allows Extreme Art Studio to pursue legal action against the franchisee in a location more convenient to the franchisee in certain situations.
This clause is fairly standard in franchise agreements, as it establishes a clear venue for potential legal disputes while also providing the franchisor with some flexibility to pursue legal action in the franchisee's home jurisdiction under specific circumstances. Prospective franchisees should be aware of this clause and understand that they may be required to litigate disputes in Minnesota, but also that Extreme Art Studio may choose to sue them in their own state under certain conditions.