Are actions related to the right to indemnification subject to the mediation requirements for Jersey Mikes?
Jersey_Mikes Franchise · 2025 FDDAnswer from 2025 FDD Document
- EXCEPT AS OTHERWISE PROVIDED IN THIS AGREEMENT, ANY CLAIM OR CONTROVERSY ARISING OUT OF OR RELATED TO THIS AGREEMENT, OR THE MAKING, PERFORMANCE, BREACH, OR INTERPRETATION OF THIS AGREEMENT, EXCEPT FOR ANY ACTIONS BROUGHT WITH RESPECT TO: I) OWNERSHIP OR USE OF THE MARKS; II) SECURING INJUNCTIVE RELIEF PURSUANT TO SECTION 17.6 OF THIS AGREEMENT; III) ANY COVENANT LISTED WITHIN SECTION 9 OR CONDITIONS WITHIN SECTION 7 OF THIS AGREEMENT; IV) THE RIGHT TO INDEMNIFICATION OR THE MANNER IN WHICH IT IS EXERCISED: SHALL FIRST BE THE SUBJECT OF AN INFORMAL MEETING BETWEEN THE PARTIES TO RESOLVE THE DISPUTE AND THEN SUBJECT TO NON-BINDING MEDIATION.
Source: Item 22 — CONTRACTS (FDD page 77)
What This Means (2025 FDD)
According to Jersey Mikes's 2025 Franchise Disclosure Document, actions pertaining to the right to indemnification are explicitly excluded from the mandatory mediation requirements. This means that if a dispute arises concerning indemnification, either the franchisee or Jersey Mikes can bypass mediation and proceed directly to other legal actions or remedies.
This exclusion is significant because it allows for quicker resolution of indemnification issues, which can be critical in protecting a party's financial interests. Indemnification typically involves one party compensating another for losses or damages, so the ability to promptly address such disputes can be vital. By not requiring mediation, Jersey Mikes and its franchisees can pursue immediate legal remedies if they believe it is necessary.
However, it's important to note that while mediation is not required for indemnification disputes, it is still an option. Both parties can voluntarily agree to mediate such disputes if they believe it would be beneficial. The FDD outlines the procedures for mediation, including the use of the American Arbitration Association (AAA) and the selection of a mediator, which would apply if both parties agree to mediate an indemnification matter. This flexibility allows for a case-by-case approach to dispute resolution, balancing the need for swift action with the potential benefits of mediation.
Prospective Jersey Mikes franchisees should carefully consider this exclusion and understand the circumstances under which indemnification might be sought. Understanding the implications of bypassing mediation in these situations is crucial for managing potential legal risks and protecting their investment.