Are there any disputes that are exempt from arbitration under the Monicals Pizza franchise agreement?
Monicals_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee acknowledges that any breach by Franchisee of any of the restrictions contained in Sections 6, 7 and 17 would result in irreparable injury to Franchisor, and that the damages arising out of any such breach would be difficult to ascertain, therefore, in addition to all other remedies provided by law or in equity, Franchisor shall be entitled to all equitable remedies, including injunctive relief (whether a restraining order, a preliminary injunction or a permanent injunction) against without requirement to post bond, with respect to any such breach, whether actual or contemplated, and Franchisee specifically waives any and all defenses to injunctive relief and Franchisee shall be responsible for Franchisor's reasonable attorneys' fees incurred in pursuing the same. Franchisor's right to seek injunctive relief shall take precedence over the covenant to arbitrate all disputes in accordance with Section 23.7. Franchisor's rights herein shall include pursuing injunctive relief through arbitration or in a state or federal court.
Source: Item 23 — RECEIPTS (FDD pages 46–257)
What This Means (2025 FDD)
According to Monicals Pizza's 2025 Franchise Disclosure Document, the franchise agreement includes a provision that allows Monicals Pizza to seek injunctive relief for breaches of certain sections of the agreement, specifically Sections 6, 7, and 17. This means that Monicals Pizza can pursue court orders to stop a franchisee from violating these sections, even if the agreement generally requires disputes to be resolved through arbitration.
This right to seek injunctive relief takes precedence over the standard arbitration clause in the Monicals Pizza franchise agreement. Monicals Pizza retains the option to pursue injunctive relief either through arbitration or in a state or federal court. This is particularly relevant for breaches related to restrictions on franchisee behavior, such as those concerning trade secrets, confidential information, and post-termination obligations.
For a prospective Monicals Pizza franchisee, this means that certain violations of the franchise agreement could lead to immediate legal action in the form of an injunction, potentially bypassing the arbitration process. It is important to understand the specific obligations outlined in Sections 6, 7, and 17 of the franchise agreement, as these are the areas where Monicals Pizza is most likely to seek immediate injunctive relief. This clause highlights the importance of adhering to the restrictions and obligations detailed in those sections to avoid potential legal action.