What happens if the right to use the Aplus trademark is challenged?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
her person in contesting the validity or ownership of the Marks.
You must immediately notify us when you learn about an infringement of, or challenge to your use of, any Mark, or any claim by any person of any rights in any Marks, and you must not communicate with any person other than us and our counsel regarding any infringements, challenges, or claims unless you are legally required to do so, however, you may communicate with your own counsel at your own expense. We, at our expense, take the action we think appropriate in these situations; we have exclusive control over any settlement or proceeding concerning any Mark. You must take any actions that, in the opinion of our counsel, may be advisable to protect and maintain our interests in any proceeding or to otherwise protect and maintain our interests in the Marks.
While we are not required to defend you against a claim arising from your use of our Marks, we will reimburse you for all of your expenses reasonably incurred in any legal proceeding disputing your authorized use of any Mark, but only if you notify us of the proceeding in a timely manner and you have complied with our directions with regard to the proceeding. We have the right to control the defense and settlement of any proceeding. We will not reimburse you for your expenses and legal fees for separate, independent legal counsel and for expenses in removing signage or discontinuing your use of any Mark. We will not reimburse you for disputes where we challenge your use of a Mark.
If we require, upon 30 days written notice, you must modify or discontinue the use of any Mark and use other trademarks or service marks we designate. We do not have to reimburse you for modifying or discontinuing the use of a Mark or for substituting another trademark or service mark for a discontinued Mark. If we adopt and use new or modified Marks, you must add or replace equipment, supplies and fixtures, and you must make other modifications we designate as necessary to adapt your APLUS Store for the new or modified Marks. You do not have to spend an amount unreasonably disproportionate to your initial investment during the initial term of the Franchise Agreement to conform your APLUS Store to changes to the Marks and other System modifications. We do not reimburse you for any loss of goodwill associated with a modified or discontinued Mark.
You may not register or seek to register as a trademark or service mark, either with the USPTO or any state or foreign country, any of the Marks or a trademark or service mark that is confusingly similar to any of our Marks. You may not use service marks or service names the same or confusingly similar to any of our Marks in whole or in part as part of any corporate, partnership, or other business name used by you.
ITEM 14 PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION
We do not own any patents that are material to the franchise, nor do we have any pending patent applications.
Source: Item 13 — TRADEMARKS (FDD pages 47–50)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, if a franchisee learns of any infringement or challenge to the use of any Aplus mark, they must immediately notify Aplus. The franchisee is prohibited from communicating with anyone other than Aplus and its counsel regarding the issue, unless legally required to do so, but they may communicate with their own counsel at their own expense. Aplus will take action it deems appropriate at its own expense and has exclusive control over any settlement or proceeding concerning any mark. The franchisee must take any actions deemed advisable by Aplus's counsel to protect Aplus's interests in any proceeding.
While Aplus is not required to defend a franchisee against claims arising from the use of its marks, Aplus will reimburse the franchisee for expenses reasonably incurred in a legal proceeding disputing the authorized use of any mark, provided the franchisee notifies Aplus in a timely manner and complies with Aplus's directions regarding the proceeding. Aplus retains the right to control the defense and settlement of any proceeding. However, Aplus will not reimburse franchisees for expenses related to separate legal counsel, removing signage, or discontinuing the use of any mark. Aplus also will not cover expenses for disputes where Aplus challenges the franchisee's use of a mark.
Furthermore, Aplus can require a franchisee to modify or discontinue the use of any mark with 30 days' written notice and use other trademarks or service marks that Aplus designates. Aplus is not obligated to reimburse the franchisee for modifying or discontinuing the use of a mark or for substituting another trademark or service mark. If Aplus adopts new or modified marks, the franchisee must add or replace equipment, supplies, and fixtures, and make other modifications necessary to adapt the Aplus store for the new or modified marks. The franchisee is not required to spend an amount unreasonably disproportionate to their initial investment to conform to changes. Aplus will not reimburse the franchisee for any loss of goodwill associated with a modified or discontinued mark.
It is important to note that Aplus does not have a federal registration for its principal trademark. As a result, if Aplus's right to use the trademark is challenged, franchisees may have to switch to an alternative trademark, which could increase their expenses. This lack of federal registration could potentially weaken Aplus's legal position in defending its trademarks, which could impact franchisees.