Who has the right to control the defense, respond to, or settle any action related to the indemnification of Anago, and at whose expense?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor shall have the right, through counsel of its own choice at Subfranchisor's expense, to control the defense, respond to or settle any such action, and such undertaking by Franchisor shall not, in any manner or form, diminish Subfranchisor's obligations to Franchisor hereunder.
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, Anago has the right to control the defense, respond to, or settle any action related to the indemnification. This means that if a claim arises where the subfranchisor is obligated to indemnify Anago, Anago has the authority to manage the legal proceedings.
The FDD specifies that Anago can exercise this right through counsel of its own choosing. However, this control comes at the subfranchisor's expense. The subfranchisor is responsible for covering the costs associated with the defense, response, or settlement of any such action, including reasonable attorney's fees.
This arrangement ensures that Anago maintains control over legal matters that could impact its brand and reputation, while the financial burden falls on the subfranchisor, who is responsible for the actions that triggered the indemnification obligation. This does not diminish the subfranchisor's obligations to Anago.