What constitutes a breach of the confidentiality agreement for an Afuri Ramen Dumpling franchise?
Afuri_Ramen_Dumpling Franchise · 2024 FDDAnswer from 2024 FDD Document
- 3 COVENANT OF NON-USE.
You agree not to use Confidential Information or the System, except as authorized by us.
You will obligate your owners, board of directors, your employees, and your agents to the same non-use covenant.
We must approve in writing any use of Confidential Information or System by you or your owners or your directors or employees.
- 4 RETURN OF CONFIDENTIAL INFORMATION.
You agree that all originals and copies of records, data, reports, documents, lists, plans, drawings, correspondence, memoranda, notes, and other materials related to or containing any Confidential Information, in whatever form they exist, whether written, visual, audio, video, or other form of media, shall be our sole and exclusive property.
Upon request by us, you will promptly return to us all documents or other tangible property that contains Confidential Information.
- 5 RECIPES.
Without limiting the generality of the non-disclosure and non-use provisions in this Agreement, you specifically agree not to disclose or use our recipes (by yourself or by or through any other entity or individual) in any manner other than in connection with Afuri franchises pursuant to the Franchise Agreement.
6 NON-COMPETITION COVENANT.
6.1 Covenant. During the term of your association with Franchisee and for two years thereafter, you will not directly or indirectly (including by or through any other person or entity) participate as an owner, director, officer, employee, consultant, licensor, licensee, distributor, or agent, or serve in any other capacity in any business engaged in the offer, sale, or promotion of: (1) ramen, (2) other Japanese style cuisine, (3) Vietnamese pho, or (4) any business that offers products or services that are essentially the same as, or substantially similar to, the products and services that are part of the
System.
- 6.2 Geographic Scope. During the term of your association with Franchisee, the covenants described in Section 6.1 above shall apply worldwide. During the two-year period after your association with Franchisee, such covenants will apply within the Development Territory, within a 50-mile radius of the Development Territory, and within a 50-mile radius of any location or designated territory where we operate or have granted the franchise to operate an Afuri business.
- 7 NON-DIVERSION OF BUSINESS. During the term of your association with Franchisee and for two years thereafter, you will not:
- A. divert or attempt to divert any of our business or any of our customers to any competing establishment; or
- B. do anything harmful to our goodwill associated with the Marks and System.
- 8 REMEDIES: INJUNCTION AND DAMAGES. You acknowledge that any disclosure of Confidential Information will cause irreparable harm to us. You agree that it may be difficult to measure damage to us from any breach by you or your employees and agents of this Agreement. You agree that monetary damages may be an inadequate remedy for any such breach. Accordingly, you agree that if you breach or take steps preliminary to breaching this Agreement, we shall be entitled, in addition to all other remedies we may have at law or in equity, to a restraining order, temporary and permanent injunctive relief, specific performance, or other appropriate equitable relief, without showing or proving that we actual sustained any damage.
9 MISCELLANEOUS
- 9.1 Duration.
The obligations set forth in this Agreement related to non-disclosure and nonuse of Confidential Information will continue during and beyond the term of your relationship with the Franchisee and for as long as you possess any Confidential Information in any manner.
Source: Item 23 — Receipts (FDD pages 50–189)
What This Means (2024 FDD)
According to the 2024 Afuri Ramen Dumpling Franchise Disclosure Document, a breach of the confidentiality agreement occurs if a franchisee uses confidential information or the Afuri Ramen Dumpling system without authorization. This non-use covenant extends not only to the franchisee but also to their owners, board of directors, employees, and agents, all of whom must be obligated to uphold it. Any use of confidential information or the system requires prior written approval from Afuri Ramen Dumpling.
Furthermore, the franchisee specifically agrees not to disclose or use Afuri Ramen Dumpling's recipes in any manner outside the scope of the franchise agreement. This restriction applies whether the franchisee acts directly or through another entity or individual. The agreement emphasizes that all originals and copies of records, data, reports, documents, lists, plans, drawings, correspondence, memoranda, notes, and other materials related to confidential information are the sole and exclusive property of Afuri Ramen Dumpling and must be promptly returned upon request.
The obligations regarding non-disclosure and non-use of confidential information continue during and beyond the term of the franchisee's relationship with Afuri Ramen Dumpling, lasting as long as the franchisee possesses any confidential information. Afuri Ramen Dumpling also includes a non-competition covenant that, during the term of the franchise and for two years afterward, prevents the franchisee from participating in businesses offering ramen, other Japanese-style cuisine, Vietnamese pho, or any business offering substantially similar products or services to the Afuri Ramen Dumpling system. This covenant applies worldwide during the franchise term and within a specified radius after termination.
Any disclosure of confidential information is acknowledged to cause irreparable harm to Afuri Ramen Dumpling, and monetary damages may be an inadequate remedy for such a breach. Therefore, Afuri Ramen Dumpling is entitled to injunctive relief, specific performance, or other equitable relief in the event of a breach or threatened breach, without needing to prove actual damages. This underscores the importance Afuri Ramen Dumpling places on protecting its confidential information and system, and the serious consequences that can arise from violating these agreements.