What claims related to Jersey Mikes are exempt from the mediation requirement?
Jersey_Mikes Franchise · 2025 FDDAnswer from 2025 FDD Document
- 27.2 EXCEPT AS OTHERWISE PROVIDED IN THIS AGREEMENT, ANY CLAIM OR CONTROVERSY ARISING OUT OF OR R ELATED 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 27.6; III) ANY COVENANT LISTED WITHIN SECTION 16 OR CONDITIONS WITHIN SECTION 17 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, certain actions are exempt from the initial requirement of informal meetings and non-binding mediation. Specifically, any actions brought with respect to the following are exempt: ownership or use of the marks, securing injunctive relief pursuant to section 27.6 of the Franchise Agreement, any covenant listed within section 16 or conditions within section 17 of the Franchise Agreement, and the right to indemnification or the manner in which it is exercised.
This means that Jersey Mikes, or the franchisee, can immediately pursue legal action, including lawsuits or other formal legal proceedings, regarding these specific issues without first attempting to resolve the matter through informal meetings or mediation. This is a deviation from the standard process, which typically requires these preliminary steps to encourage dispute resolution before resorting to litigation.
For a prospective Jersey Mikes franchisee, this is important to understand because it clarifies the circumstances under which either party can bypass mediation and proceed directly to court or other legal remedies. These exceptions often relate to critical aspects of the franchise agreement, such as protecting intellectual property (the marks) or enforcing specific obligations outlined in the agreement. The ability to seek injunctive relief without mediation is particularly significant, as it allows Jersey Mikes to quickly address actions by a franchisee that could cause immediate harm to the brand or system. Similarly, the franchisee can seek immediate action relating to indemnification without mediation.
It is also important to note that the sections referenced in the exceptions (sections 27.6, 16 and 17) should be carefully reviewed to fully understand the scope of these exemptions. Franchisees should seek legal counsel to fully understand their rights and obligations under the franchise agreement, particularly regarding dispute resolution processes and the exceptions to those processes.