What is an Alloy franchisee required to do if someone infringes on the Alloy Trademarks?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
use is under a license we have issued to you. All your internal and external signs must comply at all times with our outdoor/indoor guidelines and practices, as they are modified from time to time.
- D. Litigation. In the event any person or entity improperly uses or infringes the Trademarks or challenges your use or our use or ownership of the Trademarks, you must promptly notify us of any such use or infringement of which you are aware or any challenge or claim arising out of your use of any Trademark. We or our Affiliate have the sole right to direct and control any administrative proceeding or litigation involving the Trademarks, including any settlement. We or our Affiliate have the right, but not the obligation, to take action against uses by others that may constitute infringement of the Trademarks. We or our Affiliate may defend you against any thirdparty claim, suit or demand arising out of your use of the Trademarks. If we or our Affiliate determine that you have used the Trademarks in accordance with this Agreement, the cost of the defense, including the cost of any judgment or settlement, will be borne by us or our Affiliate. If we or our Affiliate determine that you have not used the Trademarks in accordance with this Agreement, the cost of the defense, including the cost of any judgment or settlement, will be yours. In the event of any litigation relating to your use of the Trademarks, you must sign any and all documents and do the acts as may, in our opinion, be necessary to carry out the defense or prosecution, including becoming a nominal party to any legal action, and we or our Affiliate will reimburse you for your out-of-pocket costs in doing these acts except if this litigation is the result of your use of the Trademarks in a manner inconsistent with the terms of this Agreement.
- E. Changes. You may not make any changes or substitutions to the Trademarks unless we direct in writing. We reserve the right to change or modify the Trademarks, including the ALLOY Trademark, at any time. For example, we may require you to cease all use of the ALLOY Trademark at any time and require you to use a different Trademark as we may designate in connection with the operation and identification of your Facility.
Source: Item 23 — RECEIPTS (FDD pages 69–245)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, if a franchisee becomes aware of any improper use or infringement of the Alloy Trademarks, or if someone challenges the use or ownership of those trademarks, the franchisee must promptly notify Alloy. This requirement ensures that Alloy is aware of any potential threats to its brand and intellectual property.
Alloy retains the sole right to direct and control any administrative or legal proceedings related to the trademarks, including settlements. Alloy also has the right, but not the obligation, to take action against others who may be infringing on the trademarks. Furthermore, Alloy may defend the franchisee against any third-party claims arising from the franchisee's use of the trademarks, provided the franchisee has used the trademarks in accordance with the franchise agreement. If Alloy determines that the franchisee has not used the trademarks correctly, the franchisee will bear the costs of the defense, including any judgments or settlements.
In cases of litigation related to the use of Alloy's trademarks, the franchisee is required to sign necessary documents and perform actions to aid in the defense or prosecution, potentially including becoming a nominal party in legal actions. Alloy will cover the franchisee's out-of-pocket costs for these actions, unless the litigation arises from the franchisee's misuse of the trademarks. For franchisees in Minnesota, Alloy will undertake the defense of any infringement claim by third parties involving the Alloy Trademark, and the franchisee must cooperate with the defense in a reasonable manner, with Alloy bearing the direct costs of such cooperation.
These stipulations are typical in franchise agreements to protect the brand's intellectual property. It is important for prospective Alloy franchisees to understand their obligations and potential liabilities related to trademark use and infringement.