In R & F, LLC v. Brooke Corporation, 2008 WL 294517 (D. Kan. Jan. 31, 2008), the federal district court in Kansas granted a franchisor defendant’s motion in part and issued a stay to provide an opportunity for the parties to mediate the dispute, as required by their franchise agreement. Plaintiff R & F, LLC brought suit alleging that franchisor Brooke Corporation breached the franchise agreement by failing to provide contacts with insurance companies in the markets where R & F conducts its business, in order for R & F to offer insurance products to its customers and potential customers. The franchisor in turn sought a court order to enforce the mandatory mediation provision in the franchise agreement. The court granted the order, holding that mandatory mediation provisions are enforceable under Kansas law and rejecting the plaintiff’s argument that mediation would be a “hollow exercise.” Because the plaintiff agreed to the provision in the franchise agreement, the court held that any “arguable futility of mediation is of no consequence.”
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