Does the Bang Cookies franchise agreement require the franchisee to procure an assignment of ideas from their employees to the franchisor?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisee agrees that with regard to the Franchised Business, all customer lists, including the contents and information contained in all customer lists, constitute Confidential Information and an asset of Franchisor whether or not such information was supplied by Franchisor. During the Term, and in connection with the development, establishment, marketing, promotion and operation of the Franchised Business, Franchisee shall disclose to Franchisor all of Franchisee's ideas, concepts, methods, and products conceived or developed by Franchisee, any Owner, and/or Franchisee's affiliates, officers, directors, shareholders, partners, agents, members, representatives, independent contractors, servants and employees relating to the development and operation of Bang Cookies Shops and the System. Franchisee hereby assigns to Franchisor, and Franchisee agrees to procure an assignment of any such ideas, concepts, methods, and products that Franchisee is required to disclose to Franchisor under this Article 11.F. from each Owner and Franchisee's affiliates, officers, directors, shareholders, partners, agents, members, representatives, independent contractors, servants and employees. Franchisor shall have no obligation to tender any lump sum payment, on-going payments, or any other consideration to Franchisee, any Owner, each Owner and Franchisee's affiliates, officers, directors, shareholders, partners, agents, members, representatives, independent contractors, servants and employees with respect to any such idea, concept, method, technique or product. Franchisee agrees that Franchisee shall not use, or allow any other person or entity to use, any such concept, method, technique, or product without obtaining Franchisor's prior written approval.
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, the franchise agreement requires franchisees to disclose and assign certain intellectual property to Bang Cookies. Specifically, during the term of the agreement, franchisees must disclose all ideas, concepts, methods, and products conceived or developed by the franchisee, their owners, affiliates, agents, and employees related to the development and operation of Bang Cookies shops.
The agreement explicitly states that the franchisee must assign these ideas, concepts, methods, and products to Bang Cookies. Furthermore, the franchisee is responsible for procuring assignment of these items from their owners, affiliates, and employees. This means the franchisee has an obligation to ensure that their employees and related parties also formally assign any such intellectual property to Bang Cookies.
Bang Cookies is not obligated to provide any payment or consideration for these assigned items. The franchisee also agrees that neither they nor anyone else can use these concepts, methods, or products without Bang Cookies's prior written approval. This clause ensures that Bang Cookies retains full control over any innovations or improvements developed within the franchise system.