For how long after disclosure is the receiving party obligated to protect the disclosing party's Confidential Information, excluding software, under the Atwell Suites franchise agreement?
Atwell_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
rforming its obligations under this Master Technology Schedule; provided that Licensee may disclose Confidential Information to its employees, contractors and professional advisors who need to know such information in order to perform their obligations related to this Master Technology Schedule and who are contractually bound by confidentiality obligations that are at least as protective as those in this Master Technology Schedule. Licensee shall use commercially reasonable care and discretion to avoid unauthorized use, disclosure, publication, or dissemination of Confidential Information (which shall be no less than the standard of care used by Licensee to protect its Confidential Information of a similar nature). For Confidential Information that does not constitute a "trade secret" under applicable law, these confidentiality obligations will expire three (3) years after the termination or expiration of the License. For Confidential Information that constitutes a "trade secret" under applicable law, these confidentiality obligations will continue until such information ceases to constitute a "trade secret" under such applicable law.
Source: Item 23 — Receipts (FDD pages 99–486)
What This Means (2025 FDD)
According to the 2025 Atwell Suites Franchise Disclosure Document, the confidentiality obligations for information that does not constitute a trade secret expire three years after the termination or expiration of the franchise agreement. This means that after the Atwell Suites franchise agreement ends, either through its natural expiration or earlier termination, the franchisee must continue to keep confidential information confidential for an additional three years.
This obligation does not apply to information that qualifies as a trade secret under applicable law. For trade secrets, the confidentiality obligations continue indefinitely, lasting as long as the information remains a trade secret. This distinction is important because trade secrets are afforded a higher level of protection and can include proprietary formulas, processes, or methods that give Atwell Suites a competitive advantage.
The franchisee is responsible for ensuring that their employees, contractors, and affiliates also comply with these confidentiality obligations. This includes taking commercially reasonable steps to prevent unauthorized use or disclosure of confidential information. The FDD specifies that the standard of care should be no less than what the franchisee uses to protect its own confidential information of a similar nature. This places a significant responsibility on the franchisee to maintain robust security measures and training programs to safeguard Atwell Suites's confidential information both during and after the franchise term.