The federal district court in New Jersey has changed its mind and has now confirmed an arbitration award won by a franchisor. Bapu Corp. v. Choice Hotels International, Inc., 2008 WL 4192056 (D.N.J. Sept. 8, 2008). The court’s earlier decision, as reported in Issue 109 of The GPMemorandum, had vacated the award based on the court’s belief that the applicable statute of limitations had expired before the franchisor commenced the arbitration. In reconsidering that decision, the court realized that the statute of limitations evaluation was for the arbitrator, not the court, to decide. The court now also rejected the franchisee’s other arguments to overturn the award, such as that the arbitrator had been biased, that the arbitration hearing should have been postponed, and that hearsay evidence had been improperly admitted.
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The Franchise Memorandum is a collection of postings on summaries of recent legal developments of interest to franchisors brought to you by Lathrop GPM LLP.
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