To what extent can an Afuri Ramen Dumpling franchisee disclose confidential information to their employees?
Afuri_Ramen_Dumpling Franchise · 2024 FDDAnswer from 2024 FDD Document
may take such action as we deem necessary to protect our interests. You agree to execute any and all documents and to do all acts and things in the opinion of our counsel are necessary or advisable to protect our interests.
- 2. COVENANT OF NON-DISCLOSURE. You specifically acknowledge that you will receive valuable specialized and Confidential Information, including information regarding our operational, sales, promotional and marketing methods and techniques and the System. You agree not to disclose Confidential Information to any third party and to limit disclosure within your association to designated employees approved by us. Disclosures to designated employees will be done on a "need to know" basis to the extent necessary for them to perform the duties of their employment with you. Unless required by court order or applicable law, you agree not to copy, download, send, or divulge any Confidential Information directly or indirectly to any other person or enterprise outside of our system. Except in connection with an Afuri franchise, you will never communicate, divulge, or use in any manner, either for your benefit or the benefit or any other person, persons, partnerships, associations, companies or corporations any Confidential Information or proprietary information, knowledge or know-how concerning the System or any information we have communicated to you in written, verbal or electronic form, including intranet passwords, for the operation of your business.
- 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.
Source: Item 23 — Receipts (FDD pages 50–189)
What This Means (2024 FDD)
According to the 2024 Afuri Ramen Dumpling FDD, franchisees have specific obligations regarding the disclosure of confidential information to their employees. Afuri Ramen Dumpling requires franchisees to obligate their employees to the same non-use covenant that they themselves are subject to, meaning employees must agree not to use confidential information except as authorized by Afuri Ramen Dumpling. Franchisees must also exercise a high degree of care in safeguarding confidential information against loss, theft, or inadvertent disclosure, using the same confidentiality protection practices they employ for their own confidential information, but no less than a reasonable degree of care. This includes obligating employees and consultants who receive confidential information to covenants of confidentiality and non-use. Franchisees must limit disclosure within their association to designated employees approved by Afuri Ramen Dumpling, and such disclosures should be done on a "need to know" basis, only to the extent necessary for employees to perform their duties.
Afuri Ramen Dumpling emphasizes that franchisees should not communicate or divulge the contents of the Operations Manuals or any other information related to the System to any person or entity except those authorized in writing by Afuri Ramen Dumpling. Franchisees must fully and strictly adhere to all security procedures prescribed for maintaining the confidentiality of the Confidential Information. They are required to disclose information to their employees only to the extent necessary to perform the franchise business. Franchisees also agree not to use Afuri Ramen Dumpling's 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.
In practical terms, this means an Afuri Ramen Dumpling franchisee must implement robust confidentiality protocols, including training employees on their responsibilities to maintain confidentiality and limiting access to confidential information on a need-to-know basis. The franchisee must also ensure that employees are bound by confidentiality agreements. Failure to comply with these requirements could result in a breach of the franchise agreement and potential legal consequences. This is stricter than some franchise systems, which may not require such stringent controls over employee access to confidential information.