Are negotiations and mediation proceedings confidential according to the Itan FDD?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
All negotiations and mediation proceedings (including all discovery conducted therein and statements and settlement offers made by either party or the mediator in connection with the mediation): (a) shall be strictly confidential; (b) shall constitute "settlement negotiations" for purposes of federal and state rules of evidence; and (c) shall not be admissible or otherwise used for any purpose in any court or arbitration proceeding (except evidence that would otherwise be discoverable or admissible shall not be excluded from discovery or made inadmissible simply because of its use in mediation). The mediator may not be called as a witness for any purpose in any court proceeding. Any Dispute involving Claims alleging a breach of §14, §17 and/or §21 (referred to as "Excluded Claims") is not subject to mandatory negotiation or mediation unless both parties agree otherwise.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to the 2025 Itan FDD, negotiations and mediation proceedings are strictly confidential. The FDD specifies that all negotiations and mediation efforts related to disputes will be kept private. This includes any discovery conducted during these proceedings, as well as statements and settlement offers made by either party or the mediator.
This confidentiality provision means that any information disclosed or discussed during negotiation or mediation cannot be used in court or arbitration. The only exception is evidence that would otherwise be discoverable or admissible; its use in mediation does not exclude it from discovery or make it inadmissible. The mediator is also prohibited from being called as a witness in any court proceeding.
This level of confidentiality is intended to encourage open and honest communication during dispute resolution, without fear that the information shared could be used against either party in future legal proceedings. However, Itan notes that claims alleging a breach of §14, §17 and/or §21 are not subject to mandatory negotiation or mediation unless both parties agree otherwise.