What limitation periods are Franchisor and Franchisee bound to in the Mrcool arbitration process?

According to Mrcool's 2025 Franchise Disclosure Document, both the franchisor and franchisee are bound to the limitation periods outlined in Article 18.I of the franchise agreement during any arbitration proceeding. Furthermore, both parties must submit any claim that would constitute a compulsory counterclaim, as defined under Rule 13 of the United States Federal Rules of Civil Procedure, within the same arbitration proceeding. Failure to submit a claim as required will result in the claim being permanently barred.

This means a Mrcool franchisee needs to be aware of the specific limitation periods detailed in Article 18.I to ensure any claims they may have against Mrcool are filed within the appropriate timeframe. Missing this deadline could mean forfeiting the right to pursue those claims through arbitration. Similarly, Mrcool must adhere to these limitation periods when bringing claims against the franchisee.

The requirement to submit compulsory counterclaims in the same arbitration proceeding is a standard legal practice aimed at resolving all related disputes in a single forum. For a Mrcool franchisee, this means they must carefully assess whether any potential counterclaims exist when responding to an arbitration demand from Mrcool. Failing to raise these counterclaims at the outset could prevent them from being raised later.

It is important for prospective Mrcool franchisees to carefully review Article 18.I of the franchise agreement with their legal counsel to fully understand the applicable limitation periods and the implications of the compulsory counterclaim rule. This will help ensure they are prepared to protect their legal rights in the event of an arbitration proceeding.