What constitutes an infringement of Bang Cookies' rights to the Licensed Marks or the System by the franchisee?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
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17.A. PAYMENT OF AMOUNTS OWED TO FRANCHISOR
Without limitation as to any other Article or provision of this Agreement, upon expiration or termination of this Agreement for any reason, Franchisee shall immediately pay to Franchisor all sums and fees due from Franchisee to Franchisor under the terms of this Agreement including, but not limited to Royalty Fees and Advertising Contributions and all other sums and fees due from Franchisee to Franchisor and/or Franchisor affiliates and/or suppliers for products and services including, but not limited to, System Supplies.
17.B. CEASE OPERATIONS AND PROTECTION OF THE SYSTEM
Upon expiration, termination, or Transfer of this Agreement for any reason, Franchisee shall immediately:
- (1) Permanently cease to be a franchise owner of the Shop that was the subject of this Agreement and cease to operate such Shop under the System;
- (2) Refrain from directly or indirectly, holding oneself/itself out to any person or entity, or represent themselves/itself as a present or former Bang Cookies franchisee;
- (3) Permanently cease to use, in any manner: (a) the System including, without limitation, the Confidential Information, the Licensed Marks, the Business Management System Data, and the operations manual; (b) any methods, procedures, or techniques associated with the System in which Franchisor possesses proprietary rights or constitute Franchisor's trade secrets; (c) System Supplies, including communicating with or ordering products from Franchisor's designated suppliers and vendors of System Supplies; (d) the Approved Services and Products;
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies' 2024 Franchise Disclosure Document, after the agreement expires, is terminated, or is transferred for any reason, the franchisee must immediately cease operating as a Bang Cookies franchise and must not represent themselves as a current or former franchisee. The franchisee must also permanently stop using the Bang Cookies System, which includes the Licensed Marks, confidential information, business management system data, and operations manual.
This extends to methods, procedures, or techniques associated with the System, System Supplies, Approved Services and Products, and any advertising or marketing materials related to Bang Cookies. The franchisee is also required to return the operations manual, confidential information, and all other confidential materials and equipment owned by Bang Cookies. However, the franchisee can retain copies of the Franchise Agreement, correspondence with Bang Cookies (excluding confidential information), and other documents required by law.
In practical terms, this means that a former Bang Cookies franchisee cannot continue to operate a similar business using Bang Cookies' branding, methods, or proprietary information. Doing so would be considered an infringement of Bang Cookies' rights. This is a standard clause in franchise agreements to protect the brand's intellectual property and maintain consistency across the franchise system.