What is the first step a Spray Net franchisee must take when they have a claim or dispute with the franchisor?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
Before commencing any legal action against Franchisor or its affiliates with respect to any such claim or dispute, Franchisee must submit a notice to Franchisor, which specifies, in detail, the precise nature and grounds of such claim or dispute.
Franchisor will have a period of thirty (30) days following receipt of such notice within which to notify Franchisee as to whether Franchisor or its affiliates elects to exercise its option to submit such claim or dispute to mediation.
Franchisee may not commence any action against Franchisor or its affiliates with respect to any such claim or dispute in any court unless Franchisor fails to exercise its option to submit such claim or dispute to mediation, or such mediation proceedings have been terminated either: (i) as the result of a written declaration of the mediator(s) that further mediation efforts are not worthwhile; or (ii) as a result of a written declaration by Franchisor.
Franchisor's rights to mediation, as set forth herein, may be specifically enforced by Franchisor.
Each party will bear its own cost of mediation and Franchisor and Franchisee will share mediator fees equally.
This agreement to mediate will survive any termination or expiration of this Agreement.
The parties will not be required to first attempt to mediate a controversy, dispute, or claim through mediation as set forth in this Section 21(C) if such controversy, dispute, or claim concerns an allegation that a party has violated (or threatens to violate, or poses an imminent risk of violating): (i) any federally protected intellectual property rights in the Proprietary Marks, the System, or in any Confidential Information or other confidential information; (ii) any of the restrictive covenants contained in this Agreement; and (iii) any of Franchisee's payment obligations under this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
According to Spray Net's 2025 Franchise Disclosure Document, before starting any legal action against Spray Net or its affiliates regarding a claim or dispute, a franchisee must first submit a detailed notice to Spray Net. This notice must specify the precise nature and grounds for the claim or dispute.
Following the franchisee's notice, Spray Net has 30 days to decide whether to submit the claim or dispute to mediation. The franchisee cannot take legal action in court unless Spray Net declines mediation or the mediation ends without resolution. Termination can occur if the mediator declares further efforts are not worthwhile or if Spray Net makes a written declaration.
Spray Net retains the right to enforce mediation. Each party is responsible for their own mediation costs, and they will equally share the mediator's fees. This mediation agreement remains in effect even after the termination or expiration of the Franchise Agreement. However, mediation is not required for disputes involving violations of federally protected intellectual property rights, restrictive covenants, or the franchisee's payment obligations under the agreement.