Is Angry Chickz obligated to defend a franchisee against an infringement claim related to the Marks?
Angry_Chickz Franchise · 2025 FDDAnswer from 2025 FDD Document
11.4.1 If Franchisee receives notice, or is otherwise informed, of any claim, suit or demand against Franchisee of any alleged infringement, unfair competition or similar matter on account of its use of the Marks or trade dress, Franchisee shall promptly notify Company of the same. Company shall take such action as it may deem necessary and appropriate to protect and defend Franchisee against any such claim, but Company shall not be obligated to take any such action, however. Franchisee shall not settle or compromise any claim by a third party without the prior written consent of Company. Company shall have the sole right to defend, compromise or settle any claim, in its discretion, at Company's sole cost and expense, using attorneys of its own choosing.
Source: Item 22 — CONTRACTS (FDD page 54)
What This Means (2025 FDD)
According to the 2025 Angry Chickz Franchise Disclosure Document, Angry Chickz is not obligated to defend a franchisee against an infringement claim related to the Marks. However, if a franchisee receives notice of any claim, suit, or demand against them regarding alleged infringement or unfair competition due to their use of the Angry Chickz Marks or trade dress, the franchisee must promptly notify Angry Chickz.
Angry Chickz retains the right to take action it deems necessary to protect and defend the franchisee against such claims, but it is not required to do so. The FDD specifies that Angry Chickz has the sole right to defend, compromise, or settle any claim at its discretion, using attorneys of its choosing, and at its sole cost and expense.
The franchisee is prohibited from settling or compromising any third-party claim without Angry Chickz's prior written consent. This means that while Angry Chickz may choose to defend the franchisee, the ultimate control over the legal strategy and resolution of any infringement claim rests solely with Angry Chickz.