In Michigan, is a Kidokinetics franchisee prohibited from agreeing to conduct arbitration outside of Michigan at the time of arbitration?

According to Kidokinetics's 2024 Franchise Disclosure Document, Michigan law includes specific protections for franchisees. If any franchise documents contain a provision requiring arbitration or litigation to be conducted outside of Michigan, that provision is void and cannot be enforced against the franchisee. However, a Kidokinetics franchisee is not prohibited from entering into an agreement, at the time of arbitration, to conduct arbitration at a location outside of Michigan.

This means that while the initial franchise agreement cannot force a Michigan franchisee into out-of-state arbitration, the franchisee can later agree to it if they choose. This protects the franchisee from being bound by unfavorable terms at the outset while still allowing flexibility should both parties agree to an alternative arrangement later.

This type of regulation is in place to protect franchisees, who may have less bargaining power than the franchisor. By ensuring that the initial agreement cannot force out-of-state arbitration, Michigan law aims to keep legal proceedings within the state, which can be more convenient and cost-effective for the franchisee. However, the ability to agree to out-of-state arbitration at the time of the dispute provides a degree of flexibility for both parties to find a mutually agreeable resolution process.