What recourse does an Atwell Suites franchisee have if the Services provided are suspected of infringing on intellectual property rights?
Atwell_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
The following language will appear at the end of paragraph 13.B of the License:
"Pursuant to Minn. State. Sec. 80C.21, this paragraph shall not in any way abrogate or reduce any rights of the Licensee as provided for in the Minnesota Statutes 1987, Chapter 80C, including, but not limited to, the right to submit matters to the jurisdiction of the courts of Minnesota.
Minnesota law provides licensees with certain termination and non-renewal rights. Minnesota Statutes, Section 80C.14 subdivisions 3, 4, and 5 require, except in certain specified cases, that a licensee be given 90 days' notice of termination (with 60 days to cure) and 180 days' notice for non-renewal of the License."
- Section 6 of the License is amended by adding the following language:
"The Minnesota Department of Commerce requires that IHG indemnify Minnesota licensees against liability to third parties resulting from claims by third parties that the Licensee's use of IHG's trademark infringes trademark rights of the third party. IHG does not indemnify against the consequences of Licensee's use of IHG's trademark except in accordance with the requirements of the License, and, as a condition to indemnification, Licensee must provide notice to IHG of any such claim within ten (10) days and tender the defense of the claim to IHG. If IHG accepts the tender of defense, IHG has the right to manage the defense of the claim including the right to compromise, settle or otherwise resolve the claim, and to determine whether to appeal a final determination of the claim."
Source: Item 23 — Receipts (FDD pages 99–486)
What This Means (2025 FDD)
According to the 2025 Atwell Suites FDD, the recourse available to a franchisee regarding intellectual property infringement depends on the location of the franchise. Generally, IHG (the franchisor) retains control over trademark disputes, but specific state laws can modify these terms.
For instance, the standard Atwell Suites license agreement stipulates that IHG has the sole right to handle disputes concerning the use of the brand's trademarks or the Brand System. The franchisee is required to notify IHG immediately of any potential infringements or challenges to the use of the Marks and must cooperate fully with IHG in resolving such matters. The franchisee cannot initiate any legal actions to enforce or protect the Marks or Brand System. All recoveries from disputes related to the Marks or Brand System go to IHG. However, an amendment to the agreement for Atwell Suites hotels issued in Minnesota states that IHG must indemnify Minnesota franchisees against liability to third parties resulting from claims that the franchisee's use of IHG's trademark infringes on the trademark rights of a third party. To be indemnified, the franchisee must notify IHG of any such claim within ten days and tender the defense of the claim to IHG, which then has the right to manage the defense, including settling or resolving the claim.
For franchisees in Washington, the FDD includes an amendment pursuant to the Washington Franchise Investment Protection Act, which may affect the enforceability of certain provisions in the license agreement. These provisions cover aspects such as the site of arbitration, mediation, or litigation, releases or waivers of rights, and statutes of limitations. Franchisees should consult the specific state addendum included with the FDD to understand how local laws modify the standard agreement terms and what specific rights they may have in case of disputes.