Who has the exclusive right to handle legal actions related to infringement of the 360 Painting marks?
360_Painting Franchise · 2025 FDDAnswer from 2025 FDD Document
- 14.4 Infringement. Franchisee shall promptly inform Franchisor in writing of any infringement or imitations of any Marks, the System, or any act of unfair competition against Franchisor or Franchisee as to which Franchisee has knowledge. Franchisee shall not make any demand or serve any notice, orally or in writing, or institute any legal action or negotiate, compromise or settle any controversy with respect to any such infringement or unfair competition without first obtaining Franchisor's written consent. Franchisor shall have the exclusive right to institute, negotiate, compromise, settle, dismiss, appeal or otherwise handle any such action and take such steps as it may deem advisable to prevent any such action and to join Franchisee and any other franchisees as a party to any such action to which Franchisor may be a party and to which Franchisee is or would be a necessary or proper party, but nothing herein shall be construed to obligate Franchisor to seek recovery of costs or damages of any kind in any such litigation, the assertion or waiver of such claims being within the sole discretion of Franchisor. The costs of any such action shall be paid by Franchisor, and any recovery obtained from such infringers shall be paid to Franchisor.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 56)
What This Means (2025 FDD)
According to 360 Painting's 2025 Franchise Disclosure Document, 360 Painting retains the exclusive right to manage legal actions regarding infringement of its marks. As a 360 Painting franchisee, if you become aware of any infringement or imitation of the 360 Painting marks or any act of unfair competition, you must promptly inform 360 Painting in writing.
Specifically, the franchisee is prohibited from independently making any demands, serving notices, initiating legal action, or negotiating settlements related to such infringement or unfair competition without first obtaining written consent from 360 Painting. This means that while franchisees are obligated to report any potential infringement, they cannot take any independent legal action.
360 Painting has the sole discretion to institute, negotiate, compromise, settle, dismiss, appeal, or otherwise handle any legal action pertaining to infringement. They can also involve the franchisee in such actions if deemed necessary. The FDD states that 360 Painting is not obligated to seek recovery of costs or damages in any litigation, as the assertion or waiver of such claims falls within their sole discretion. Furthermore, 360 Painting will cover the costs of any legal action, and any monetary recovery obtained from infringers will be paid to 360 Painting.