Under what circumstances is the non-disparagement clause in the Aplus franchise agreement not applicable?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
Subject to applicable law, Franchisee and each Owner agree that neither will make any oral or written statement to the public or any third party that is false, negative, critical, or disparaging, implied or expressed, or otherwise degrades the reputation of, or concerning Franchisor or any of Franchisor's respective affiliates, subsidiaries, parents, and its respective owners, managers, board members, principals, officers, members, agents, or employees. This Section 13.22 shall not be construed to prohibit any person from responding when required by law, subpoena, court order, or the like.
Source: Item 23 — RECEIPT (FDD pages 68–302)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, the non-disparagement clause within the franchise agreement has a specific exception. Franchisees and owners are generally prohibited from making any public statements that are false, negative, critical, or disparaging about Aplus or its affiliates. This restriction aims to protect the brand's reputation.
However, this non-disparagement clause does not prevent anyone from responding to legal requirements. Specifically, the clause does not prohibit responses that are required by law, subpoena, court order, or similar legal processes.
This means that if a franchisee is legally compelled to provide information or testimony that could be considered negative or critical of Aplus, the non-disparagement clause would not apply. This exception ensures that franchisees can comply with legal obligations without violating the franchise agreement.