Dispute & Arbitration

Merchonic Dispute and Arbitration Terms

Effective Date: July 29, 2026

IMPORTANT – PLEASE READ CAREFULLY: These terms contain an agreement to resolve many disputes through individual binding arbitration, a waiver of jury trials, and a waiver of class, collective, and representative proceedings. They also establish a separate Platform process for disputes over transaction funds. Arbitration is not the same as Merchonic’s internal transaction-dispute review.

These Dispute and Arbitration Terms (“Dispute Terms”) apply to the Merchonic Platform and are incorporated into the Merchonic Terms of Service. They govern: (1) transaction disputes between Customers and Vendors concerning Jobs, Deliverables, payment release, refunds, shortages, defects, or related performance; and (2) legal disputes involving Merchonic or, where stated, disputes between Users. If you do not agree, do not use the Platform. Capitalized terms not defined here have the meanings given in the Terms of Service or Payment and Funds Release Terms.

1. Definitions and Two Separate Dispute Tracks

“Platform Dispute” means Merchonic’s internal process for deciding how transaction funds should be released, refunded, held, or otherwise administered under the Payment and Funds Release Terms. “Legal Dispute” means a claim, controversy, or dispute based in contract, tort, statute, fraud, misrepresentation, consumer protection, equity, or any other legal theory. “Notice of Dispute” means the written pre-arbitration notice described below. “Arbitration Provider” means the American Arbitration Association (“AAA”) unless another provider is selected under these Dispute Terms.

A Platform Dispute is not a court case and Merchonic is not acting as a judge or arbitrator when it administers transaction funds. A Platform decision may determine only the treatment of funds or Platform access within Merchonic’s systems, unless applicable law or a separate written agreement provides otherwise. Legal rights that are not resolved through the Platform process remain subject to the arbitration and court provisions below.

2. Direct Resolution Between Customer and Vendor

Before escalating a Platform Dispute, the Customer and Vendor must use Merchonic’s messaging system to make a good-faith effort to resolve the issue. Each party should identify the requested outcome and provide relevant information, which may include the accepted Bid, specifications, proofs, change orders, messages, invoices, production records, photographs, videos, samples, tracking, delivery records, and evidence of defects, shortages, damage, or corrective efforts.

Unless urgent action is reasonably necessary to prevent fraud, dissipation of funds, safety harm, infringement, evidence loss, or expiration of a payment-provider deadline, a party should allow at least seven (7) calendar days for direct resolution before escalating the matter.

3. Escalation to Merchonic and Evidence Review

3.1 Opening a Platform Dispute

A party may open a Platform Dispute through the available Platform process within the deadline stated in the Payment and Funds Release Terms. The request must accurately describe the dispute, identify the requested remedy, and include reasonably available evidence. Merchonic may reject an untimely, incomplete, abusive, fraudulent, or ineligible request, subject to applicable law.

3.2 Preservation and Cooperation

Users must preserve relevant goods, packaging, files, messages, records, and other evidence; reasonably cooperate with requests for information, inspection, return, sampling, carrier documentation, or processor documentation; and must not alter, destroy, conceal, or fabricate evidence. Merchonic may draw reasonable inferences from a User’s failure to provide information within that User’s possession or control.

3.3 Temporary Holds and Protective Measures

While a Platform Dispute is pending, Merchonic or its payment provider may pause release, payout, refund, withdrawal, account access, or related transaction activity when reasonably necessary to preserve funds, prevent fraud, comply with law, or protect Users. A hold is not a final finding of fault.

3.4 Merchonic Review and Possible Outcomes

Merchonic may facilitate negotiation, request additional evidence, recommend a resolution, or make an administrative determination under the Payment and Funds Release Terms. Possible outcomes may include full or partial release, full or partial refund, correction, reprint, replacement, completion of a shortage, return of goods, allocation of shipping costs, or another commercially reasonable remedy permitted by the User Contract and Platform Policies.

Merchonic may aim to issue a recommendation or determination within thirty (30) days after receiving sufficient information, but this is a target rather than a guarantee. Complex, safety-related, carrier, payment-processor, chargeback, or regulatory matters may require more time.

3.5 No Automatic Award for Nonparticipation

A party’s failure to participate does not automatically entitle the other party to all disputed funds. Merchonic may decide the matter based on available evidence, applicable Platform Policies, payment-provider requirements, and reasonable inferences. Merchonic may also suspend an account for bad-faith noncooperation.

4. Optional Mediation

Merchonic may offer or require a non-binding settlement conference or mediation as part of a Platform Dispute when appropriate. Unless the parties agree otherwise, participation does not waive legal claims and settlement communications are treated as confidential to the extent permitted by law. Any professional mediator’s fees must be disclosed and accepted before the mediation begins.

5. Informal Resolution Before Legal Arbitration

5.1 Notice of Dispute

Before starting arbitration against Merchonic, the claimant must send an individualized Notice of Dispute to [LEGAL NOTICE EMAIL] and [MAILING ADDRESS]. Merchonic will send any Notice of Dispute to the email and mailing address associated with the User’s account. The notice must include:

• The claimant’s full name, account email, username, mailing address, and telephone number.
• A detailed description of the claim and relevant facts.
• The specific relief requested and a good-faith calculation of any monetary demand.
• Relevant Job, transaction, and communication identifiers.
• The claimant’s personal signature or the signature of counsel authorized to act for that claimant.

Notices submitted for multiple claimants must provide the required individualized information for each claimant. A settlement demand or mass form that does not reasonably identify the individual claim is insufficient.

5.2 Thirty-Day Informal Period

The parties must make a good-faith effort to resolve the Legal Dispute for at least thirty (30) days after a complete Notice of Dispute is received. During that period, either party may request an individualized telephone or video settlement conference. Statutes of limitation and filing-fee deadlines will be tolled during the required informal period to the extent permitted by law.

6. Agreement to Individual Binding Arbitration

Except for the exclusions in Section 10 and to the fullest extent permitted by law, you and Merchonic agree that every Legal Dispute between you and Merchonic arising out of or relating to the Platform, the Platform Policies, a Job, a transaction, communications, advertising, privacy, account action, or the relationship between you and Merchonic will be resolved by individual binding arbitration rather than in court.

To the extent a Customer and Vendor have not entered a different valid dispute agreement, Legal Disputes between those Users arising from a User Contract will also be resolved by individual binding arbitration after completion of the applicable Platform Dispute process. Merchonic is not responsible for prosecuting or defending a User’s claim against another User and is not a party to that arbitration unless Merchonic is separately named on a legally valid basis.

The Federal Arbitration Act governs the interpretation and enforcement of this arbitration agreement. The arbitrator, and not a court, will decide disputes concerning the interpretation, applicability, enforceability, or formation of this arbitration agreement, except that a court will decide challenges specifically concerning the class-action waiver, mass-filing procedures, or requests for public injunctive relief when applicable law requires court determination.

7. Arbitration Provider, Rules, and Procedure

7.1 Provider and Applicable Rules

Arbitration will be administered by AAA. If the dispute qualifies as a consumer matter under AAA’s standards, the AAA Consumer Arbitration Rules and Consumer Due Process Protocol will apply. Otherwise, the AAA Commercial Arbitration Rules will apply. If twenty-five (25) or more similar demands are filed or coordinated against the same party and meet AAA’s definition of mass arbitration, AAA’s Mass Arbitration Supplementary Rules and applicable fee schedule will apply.

The current AAA rules and filing information are available from AAA. If AAA is unavailable or declines to administer the matter and the parties cannot agree on another established provider, either party may ask a court of competent jurisdiction to appoint an arbitrator or provider under applicable law. The parties will not use a provider or rule set that is found fundamentally unfair or that materially conflicts with mandatory law.

7.2 Location and Format

Hearings may be conducted by documents, telephone, videoconference, or in person as the applicable rules and arbitrator permit. A consumer may choose a reasonably convenient hearing location where required by AAA rules or applicable law. Non-consumer proceedings will occur remotely unless the arbitrator orders otherwise or the parties agree to another location.

7.3 Authority and Relief

The arbitrator may award the same individualized remedies that a court could award, including damages, declaratory relief, and injunctive relief for the individual claimant, subject to the Platform Policies and applicable law. The arbitrator may not award relief for persons who are not parties to the arbitration. Any award must be written and provide a reasoned explanation unless the parties agree otherwise. Judgment on the award may be entered in any court with jurisdiction.

7.4 Time Limits

A claim must be filed within the applicable statute of limitations. No shorter contractual limitations period applies unless stated clearly in another Platform Policy and enforceable under applicable law.

8. Arbitration Fees and Attorneys’ Fees

Filing, administrative, and arbitrator fees will be allocated under the applicable AAA rules and fee schedules. Merchonic will pay fees that applicable consumer arbitration rules require a business to pay. Merchonic will not promise to subsidize arbitration only for Jobs above a particular dollar amount. If the arbitrator finds that a claim, defense, or requested relief was frivolous, brought in bad faith, or presented for an improper purpose, the arbitrator may reallocate fees or award sanctions to the extent permitted by applicable rules and law.

Each party is responsible for its own attorneys’ fees and costs unless a statute, contract, rule, or arbitral award permits recovery. A fee-shifting provision will not deprive a consumer of rights provided by mandatory law.

9. Jury-Trial and Class-Action Waivers

YOU AND MERCHONIC WAIVE THE RIGHT TO A JURY TRIAL FOR CLAIMS SUBJECT TO ARBITRATION. EACH PARTY MAY BRING CLAIMS ONLY IN AN INDIVIDUAL CAPACITY AND NOT AS A PLAINTIFF, CLASS MEMBER, PRIVATE ATTORNEY GENERAL, OR REPRESENTATIVE IN A CLASS, COLLECTIVE, CONSOLIDATED, OR REPRESENTATIVE PROCEEDING, EXCEPT TO THE EXTENT APPLICABLE LAW MAKES A PARTICULAR WAIVER UNENFORCEABLE.

The arbitrator may consolidate claims only with the written consent of all affected parties or as expressly permitted by applicable AAA mass-arbitration rules. If a final court decision determines that the class or representative waiver is unenforceable for a particular claim or remedy, that claim or remedy will proceed in court after all arbitrable claims are completed, unless applicable law requires another sequence.

10. Claims Not Required to Be Arbitrated

The following may be pursued in court:

• An individual claim that qualifies for small-claims court, so long as it remains individual and within that court’s jurisdiction.
• A request for temporary or preliminary relief needed to prevent imminent misuse of intellectual property, unauthorized access, security harm, disclosure of trade secrets, dissipation of disputed property, or similar irreparable harm, pending arbitration.
• A claim that applicable law expressly prohibits from being arbitrated.
• A request for public injunctive relief to the extent applicable law requires that request to be decided by a court.
• An action to compel arbitration, appoint an arbitrator, confirm, modify, or vacate an award, or enforce this arbitration agreement.

Seeking temporary relief does not waive arbitration of the underlying merits.

11. Arbitration Opt-Out

A new User may opt out of the arbitration agreement in Section 6 by sending an individualized written opt-out notice within thirty (30) days after first accepting these Dispute Terms. The notice must be sent to [ARBITRATION OPT-OUT EMAIL] or [MAILING ADDRESS] and must include the User’s full name, account email, mailing address, and an unambiguous statement that the User opts out of arbitration. Opting out of arbitration will not affect the User’s other agreements with Merchonic or result in retaliation. An opt-out applies only to the individual who timely submits it and does not opt out other Users or entities.

A User who previously accepted an arbitration agreement and does not timely opt out of a later amendment remains bound by the prior arbitration agreement to the extent enforceable. Merchonic should provide a separate method to reject materially revised arbitration terms when required by law.

12. Confidentiality and Privacy

The parties will keep non-public arbitration submissions, evidence, and awards confidential except as reasonably necessary to conduct the proceeding, enforce or challenge an award, obtain legal or financial advice, comply with law, satisfy disclosure obligations, or protect safety. This provision does not prevent a User from reporting suspected unlawful conduct to a regulator or law-enforcement authority. Merchonic may use anonymized or aggregated dispute information to improve the Platform and prevent fraud, subject to the Privacy Policy.

13. Governing Law and Court Venue

The Federal Arbitration Act governs arbitration. Except to the extent federal law or mandatory law controls, these Dispute Terms and non-arbitrable disputes are governed by the law of [GOVERNING STATE], without regard to conflict-of-law rules. Court proceedings permitted under these Dispute Terms must be filed in the state or federal courts located in [COUNTY, STATE], except that a consumer may file in another venue when mandatory law permits or requires it. Before publication, Merchonic must select a state and venue connected to its actual legal entity and operations; Montana should not be used solely because it appeared in an earlier draft.

14. Changes to These Dispute Terms

Merchonic may update these Dispute Terms prospectively. Material changes will be posted with a new effective date and additional notice when required. A change will not apply to a Legal Dispute for which a complete Notice of Dispute was received before the change’s effective date. Material changes to arbitration rights will be handled in a manner that provides any notice, rejection, or opt-out opportunity required by applicable law.

15. Severability and Survival

If a provision is found unenforceable, it will be enforced to the maximum lawful extent and severed while the remainder continues, except where Section 9 requires a different result for a particular claim or remedy. The informal-resolution requirements, arbitration agreement, waivers, confidentiality obligations, governing-law provisions, and provisions that by their nature should continue will survive account closure and termination.

16. Contact and Legal Notices

Merchonic is operated by [LEGAL ENTITY NAME], a [STATE AND ENTITY TYPE], with a mailing address at [MAILING ADDRESS]. Questions may be sent to [email protected]. Formal Notices of Dispute must be sent to [LEGAL NOTICE EMAIL] and the mailing address above. Arbitration opt-out notices must be sent to [ARBITRATION OPT-OUT EMAIL] or the mailing address above.