Who has the right to control litigation involving the Alloy Trademarks?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
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.
Source: Item 23 — RECEIPTS (FDD pages 69–245)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, Alloy or its affiliate maintains the sole right to direct and control any administrative proceeding or litigation involving the Alloy Trademarks, including any settlement decisions. This means that while a franchisee must promptly notify Alloy of any potential infringement or challenges to the trademarks, Alloy ultimately decides how to respond legally.
Alloy or its affiliate also has the right, but not the obligation, to take action against uses by others that may constitute infringement of the Trademarks. Furthermore, Alloy or its affiliate may defend a franchisee against any third-party claim, suit, or demand arising out of the franchisee's use of the Alloy Trademarks. If Alloy determines that the franchisee has used the trademarks in accordance with the franchise agreement, Alloy or its affiliate will bear the cost of the defense, including any judgment or settlement costs. However, if Alloy determines that the franchisee has not used the trademarks correctly, the franchisee will be responsible for these costs.
In the event of any litigation related to the use of Alloy's trademarks, the franchisee is obligated to sign documents and perform actions necessary for the defense or prosecution, including becoming a nominal party to any legal action. Alloy or its affiliate will reimburse the franchisee for out-of-pocket costs, unless the litigation results from the franchisee's use of the trademarks in a manner inconsistent with the terms of the franchise agreement. This arrangement is typical in franchising, as it allows the franchisor to protect its brand standards and intellectual property consistently across all franchise locations.