Is Aw required to protect a franchisee's use of the marks?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
We are not required to protect your use of the Marks or to defend you against a claim against your use of the Marks, although we have the right to defend the claim if we so choose to do so. We will indemnify you against, and reimburse you for all damages (except for any consequential damages, including loss of revenue and/or profits) for which you are held liable, and for all costs you reasonably incur in the defense of any claim in which you are named as a party, in any proceeding brought against you by any third party arising out of your use of any Mark, so long as your use of the Marks was in compliance with the Franchise Agreement and our rules and you have timely notified us of the claim or proceeding.
Source: Item 13 — TRADEMARKS (FDD pages 30–32)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, Aw is not required to protect a franchisee's use of the marks or defend them against claims arising from their use, although Aw retains the right to defend such claims if it chooses. However, Aw will indemnify the franchisee against damages and costs under specific conditions.
Specifically, Aw will cover all damages (excluding consequential damages like lost revenue or profits) for which the franchisee is held liable. Aw will also reimburse the franchisee for all reasonable costs incurred in defending against any third-party claim arising from the franchisee's use of Aw's marks. This protection is contingent upon the franchisee's adherence to the Franchise Agreement and Aw's rules, as well as the franchisee providing timely notification of any such claim or proceeding.
This arrangement means that while Aw isn't obligated to proactively shield franchisees, it does offer a degree of financial protection against legal challenges related to trademark usage, provided the franchisee operates within the bounds of the franchise agreement and promptly reports any issues. It is important for prospective franchisees to understand the limitations of this protection, particularly the exclusion of consequential damages and the requirement for compliance with Aw's standards.