Where will all hearings and other proceedings take place regarding arbitration for Fly Fitness?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
- 10.3.2 All issues relating to arbitrability or the enforcement of the agreement to arbitrate contained in this Article 10 will be governed by the Federal Arbitration Act (9 U.S.C. §1 et seq.) and the federal common law of arbitration. All hearings and other proceedings will take place in the State of Nebraska, or the offices of the American Arbitration Association, or, if Franchisor so elects, in the county where the principal place of business of Developer is then located.
Source: Item 23 — RECEIPT (FDD pages 45–182)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, any hearings or other proceedings related to arbitration will occur in one of three locations. The proceedings will take place in the State of Nebraska, at the offices of the American Arbitration Association, or, if Fly Fitness chooses, in the county where the principal place of business of the Developer (franchisee) is located.
This means that a Fly Fitness franchisee could potentially be required to travel to Nebraska for arbitration hearings, depending on the location of the American Arbitration Association offices and Fly Fitness's decision. The franchisee bears the risk of increased costs if Fly Fitness elects to hold the arbitration in Nebraska, regardless of where the franchisee's business is located.
It is fairly common in franchising for the location of arbitration to be specified in the franchise agreement, often favoring the franchisor's home state. A prospective Fly Fitness franchisee should consider the potential travel expenses and logistical challenges if a dispute arises and arbitration is required in Nebraska.