For Sonesta Select Sonesta Essential franchisees, what section of the Franchise Agreement addresses arbitration?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
- (2) our relationship with you;
- (3) the scope or validity of this Agreement or any other agreement between you (or any of your owners) and us (or any of our affiliates) or any provision of any such agreements (including the validity and scope of the arbitration provision under this Section, which we and you acknowledge is to be determined by an arbitrator, not a court); or
- (4) any Brand Standard;
must be submitted for binding arbitration, on demand of either party, to the American Arbitration Association ("AAA"). The arbitration proceedings will be conducted by one arbitrator and, except as this Section otherwise provides, according to the AAA's thencurrent Commercial Arbitration Rules. All proceedings will be conducted at a suitable location chosen by the arbitrator that is within 50 miles of our or, as applicable, our
successor's or assign's then-current principal place of business (currently, Newton, Massachusetts); provided, however, that to the extent otherwise required by the North Dakota Franchise Investment Law (unless such a requirement is preempted by the Federal Arbitration Act), arbitration shall be held at a site to which we and you mutually agree. All matters relating to arbitration will be governed by the Federal Arbitration Act (9 U.S.C. §§ 1 et seq.). The interim and final awards of the arbitrator shall be final and binding upon each party, and judgment upon the arbitrator's awards may be entered in any court of competent jurisdiction.
Source: Item 23 — RECEIPTS (FDD pages 84–261)
What This Means (2025 FDD)
According to the 2025 Franchise Disclosure Document, Section 17.F of the Franchise Agreement outlines the arbitration process for Sonesta Select Sonesta Essential. Any disputes pertaining to the relationship between Sonesta Select Sonesta Essential and the franchisee, the validity of the agreement, or brand standards must be submitted for binding arbitration through the American Arbitration Association (AAA).
The arbitration proceedings will be overseen by a single arbitrator, following the AAA's Commercial Arbitration Rules. The location for these proceedings will be within 50 miles of Sonesta Select Sonesta Essential's principal place of business, which is currently in Newton, Massachusetts. However, if the North Dakota Franchise Investment Law requires a different location and is not preempted by the Federal Arbitration Act, the arbitration will be held at a mutually agreed-upon site.
The Federal Arbitration Act governs all aspects of the arbitration process. The arbitrator's decisions are final and binding, and can be enforced in any court with jurisdiction. This clause ensures that disputes are resolved through arbitration, providing a structured and legally binding process for both Sonesta Select Sonesta Essential and its franchisees.