Is an Afuri Ramen Dumpling franchisee required to obligate employees and consultants to covenants of confidentiality and non-use regarding Confidential Information?

According to Afuri Ramen Dumpling's 2024 Franchise Disclosure Document, franchisees are required to ensure that their employees and consultants who have access to confidential information are bound by confidentiality and non-use agreements. This obligation is part of safeguarding the brand's confidential information against unauthorized disclosure.

This requirement means that an Afuri Ramen Dumpling franchisee must implement measures to legally protect the franchisor's confidential information. This includes having employees and consultants sign agreements that prevent them from disclosing or using the confidential information they receive. The franchisee must exercise a high degree of care to protect this information from loss, theft, or inadvertent disclosure, using the same confidentiality protection practices they would use for their own confidential information, but no less than a reasonable degree of care.

The franchisee is also obligated to notify Afuri Ramen Dumpling immediately if they, their employees, or agents are served with any legal process, such as a subpoena, that calls for the production of confidential information. This allows Afuri Ramen Dumpling to take necessary actions to protect their interests. Furthermore, the franchisee must execute any documents and perform any actions deemed necessary by Afuri Ramen Dumpling's counsel to protect their interests.

These measures are typical in franchising to protect the franchisor's proprietary information and maintain a competitive advantage. Prospective franchisees should understand the importance of these confidentiality obligations and be prepared to implement appropriate safeguards and agreements with their staff and consultants.