factual

What constitutes a breach of the Aplus Franchise Agreement regarding the use of Marks?

Aplus Franchise · 2024 FDD

Answer from 2024 FDD Document

  • 6.1.2. Franchisee is permitted and required to use only the Marks approved by Franchisor to conduct the business granted pursuant to, and in compliance with, this Agreement and all applicable standards, specifications and operating procedures prescribed from time to time by Franchisor. Any unauthorized use of the Marks by Franchisee is a breach of this Agreement and an infringement of the rights of Franchisor in and to the Marks. Franchisee's use of the Marks, and any goodwill created thereby, shall inure to the benefit of Franchisor. Franchisee shall not at any time acquire an ownership interest in the Marks by virtue of any use it may make of the Marks. This Agreement does not confer any goodwill, title or interest in the Marks to Franchisee. Franchisee shall not, at any time during the term of this Agreement or after its termination or expiration, contest the validity or ownership of any of the Marks or assist any other person in contesting the validity or ownership of any of the Marks.

6.2. Limitations on Use

(4) use the Marks except in connection with the APlus mini market/Express and Sunoco Branded Motor Fuels.

You further agree not to:

  • (5) claim any right, title, or interest in or to such Marks;
  • (6) directly or indirectly deny or assail or assist others in denying or assailing the sole and exclusive ownership or right to control, as between Sunoco and you, of Sunoco in and to the Marks;
  • (7) register, adopt as your own property, or use or assist others in registering, adopting, or using any Marks, advertising, signs, devices, symbols, slogans, designs, or other trade indicia confusingly similar to the Marks; or
  • (8) commit other trademark violations or acts that would affect the value of the Marks or Sunoco's good will and ownership rights thereto. Any rights to any Marks obtained by you contrary to the foregoing provisions shall be held in trust for Sunoco and, upon request, you shall assign such rights free of charge to Sunoco.
  • (D) Sunoco may revise specifications for its Marks and their display requirements by giving you written notice. Any such revisions to specifications or display requirements must be fully implemented by you within the time period set forth in such written notice.
  • (E) This Lease covers the Premises only, and Sunoco does not lease its Sunoco or APlus service marks, trade dress, and service names, symbols, signs, logos, color combinations, or other forms of identification associated with Sunoco and/or the APlus franchise, to you except for use on the Premises in accordance with this Lease, your APlus Franchise Agreement for the operation of an APlus convenience store, and any Motor Fuel Supply Agreement between you and Sunoco.

17.1. Actions to be Taken

Except as otherwise provided herein, upon termination or expiration, this Agreement and all rights granted hereunder to Franchisee shall terminate and Franchisee shall:

  • 17.1.2. Cease to use the Trade Secrets or other Confidential Information, the System and the Marks including, without limitation, all slogans, symbols, logos, advertising materials, stationery, forms and any other items which display or are associated with the Marks;

Source: Item 23 — RECEIPT (FDD pages 68–302)

What This Means (2024 FDD)

According to Aplus's 2024 Franchise Disclosure Document, several actions can constitute a breach of the franchise agreement regarding the use of its proprietary marks. Aplus franchisees are permitted and required to use only the marks approved by Aplus to conduct business, adhering to all standards, specifications, and operating procedures. Any unauthorized use of the marks is considered a breach of the agreement and an infringement of Aplus's rights. The franchisee's use of the marks and any goodwill created through that use benefit Aplus. Franchisees cannot acquire ownership interest in the marks through their usage.

Specifically, the franchisee agrees not to use the marks except in connection with the Aplus mini market/Express and Sunoco Branded Motor Fuels. They cannot claim any right, title, or interest in the marks, nor can they deny or challenge Aplus's sole ownership or control of the marks. Franchisees are prohibited from registering, adopting, or assisting others in registering or adopting any marks, advertising, signs, or trade indicia that are confusingly similar to Aplus's marks.

Furthermore, franchisees must not commit any other trademark violations or actions that could negatively affect the value of the marks or Aplus's goodwill and ownership rights. Aplus may revise the specifications for its marks and their display requirements with written notice, and franchisees must fully implement these revisions within the specified timeframe. Upon termination or expiration of the franchise agreement, franchisees must immediately cease using the marks and cannot represent themselves as a current or former Aplus franchisee.

In practical terms, this means a prospective Aplus franchisee must be extremely diligent in adhering to Aplus's brand guidelines and obtaining approval for all marketing and promotional materials. Failure to do so could result in a breach of contract and potential legal ramifications. Franchisees should also be aware that they are building equity in the Aplus brand, not their own, and must relinquish all rights to the marks upon termination of the agreement.

Disclaimer: This information is extracted from the 2024 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.