Does the Learningrx agreement allow for injunctive relief despite the arbitration provision?
Learningrx Franchise · 2025 FDDAnswer from 2025 FDD Document
collectively, "Area Developer Affiliates") and the Franchisor, its officers, directors or sales employees (collectively, "Franchisor Affiliates") the parties agree that the exclusive venue for disputes between them shall be in the state and federal courts of Denver, Colorado or the Denver, Colorado office of the AAA and each party waives any objection they may have to the personal jurisdiction of or venue in the state and federal courts of Denver, Colorado or the Denver, Colorado office of the AAA. The Franchisor, the Franchisor Affiliates, the Area Developer and the Area Developer Affiliates each waive their rights to a trial by jury.
10.03. Injunctive Relief. Notwithstanding the above provision for arbitration, the Franchisor and the Area Developer will each have the right in a proper case to obtain injunctive relief and any damages incidental thereto from a court of competent jurisdiction. The Area Developer agrees that the Franchisor may obtain such injunctive relief, without posting a bond or
bonds in excess of a total of Five Hundred and 00/100 Dollars ($500.00), but upon due notice, and the Area Developer's sole remedy in the event of the entry of such injunctive relief will be the dissolution of such injunctive relief, if warranted, upon hearing duly had; provided, however, that all claims for damages by reason of the wrongful issuance of any such injunction are hereby expressly waived by the Area Developer. Area Developer agrees tha
Source: Item 23 — RECEIPT (FDD pages 54–209)
What This Means (2025 FDD)
According to the 2025 Learningrx Franchise Disclosure Document, both Learningrx and the franchisee have the right to seek injunctive relief from a court of competent jurisdiction, notwithstanding the agreement's arbitration provision. This means that even if disputes are generally subject to arbitration, either party can go to court to obtain an injunction, which is a court order requiring someone to do or stop doing something.
The franchisee agrees that Learningrx can obtain injunctive relief without posting a bond exceeding $500, provided due notice is given. The franchisee's sole remedy if an injunction is issued is to seek its dissolution if warranted, upon a hearing. However, the franchisee waives all claims for damages resulting from the wrongful issuance of such an injunction. This indicates that while a franchisee can challenge the injunction, they cannot sue Learningrx for damages if the injunction is later found to have been wrongly issued.
For an Area Developer agreement, Learningrx may seek injunctive relief for situations including using products outside the bounds of the franchise agreement, violating in-term and post-term non-competes, and trademark infringement. This clause highlights specific scenarios where Learningrx believes injunctive relief is appropriate to protect its interests. This section clarifies that the rights and remedies available to both Learningrx and the Area Developer are cumulative, meaning that exercising one right or remedy does not prevent them from using any other available legal means.