Where is the venue for any proceeding relating to or arising out of the Learningrx agreement?
Learningrx Franchise · 2025 FDDAnswer from 2025 FDD Document
10.02. Governing Law/Consent to Venue and Jurisdiction. Except to the extent governed by the United States Trademark Act of 1946 (Lanham Act, 15 U.S.C. Sections 1051 et seq.), the Federal Arbitration Act, or other federal law, this Agreement shall be interpreted under the laws of the state of Colorado and any dispute between the parties shall be governed by and determined in accordance with the substantive laws of the state of Colorado, which laws shall prevail in the event of any conflict of law. The Area Developer and the Franchisor have negotiated regarding a forum in which to resolve any disputes which may arise between them and have agreed to select a forum in order to promote stability in their relationship. Therefore, if a claim is asserted in any legal proceeding involving the Area Developer, its officers, directors, managers or partners (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
Source: Item 23 — RECEIPT (FDD pages 54–209)
What This Means (2025 FDD)
According to Learningrx's 2025 Franchise Disclosure Document, the exclusive venue for disputes between the franchisee (referred to as Area Developer) and Learningrx (referred to as Franchisor) will be in the state and federal courts of Denver, Colorado, or the Denver, Colorado office of the AAA (American Arbitration Association). This applies to any legal proceeding involving the Area Developer, its officers, directors, managers, or partners (collectively, "Area Developer Affiliates") and Learningrx, its officers, directors, or sales employees (collectively, "Franchisor Affiliates").
This means that if a Learningrx franchisee has a dispute with the company that leads to a legal claim, the case must be heard in Denver, Colorado, regardless of where the franchisee's Learningrx center is located. Both Learningrx and the franchisee waive any objections to the personal jurisdiction or venue in the state and federal courts of Denver, Colorado, or the Denver, Colorado office of the AAA.
However, there is an exception for injunctive relief. The Learningrx franchise agreement states that both Learningrx and the Area Developer have the right to seek injunctive relief and any related damages from a court of competent jurisdiction, even with the arbitration provision. This means that if either party needs immediate court action to prevent irreparable harm, they can pursue it outside of the Denver courts or AAA arbitration.
It's also important to note that the Rhode Island Franchise Investment Act has specific provisions that may override the venue selection clause. According to the addendum, any provision in the franchise agreement that restricts jurisdiction or venue to a forum outside of Rhode Island or requires the application of the laws of another state is void with respect to a claim otherwise enforceable under the Act. Therefore, for Learningrx franchisees in Rhode Island, the venue for disputes may be determined by Rhode Island law, regardless of what the franchise agreement states.