Under what conditions will Bang Cookies indemnify a franchisee against direct damages for trademark infringement?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
We will indemnify you against direct damages for trademark infringement in a proceeding arising out of your use of the Licensed Marks, provided your use of the Licensed Marks comply with the terms of your Franchise Agreement, the Manuals, our written instructions and, that you have timely notified us of the claim, have given us sole control of the defense and settlement of the claim, and you are in compliance with your Franchise Agreement and, if applicable, Multi-Unit Development Agreement. If we defend the claim, we have no obligation to indemnify or reimburse you with respect to any fees or disbursements of any attorney that you retain.
Source: Item 13 — TRADEMARKS (FDD pages 38–39)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, Bang Cookies will indemnify a franchisee against direct damages for trademark infringement under specific conditions. Bang Cookies must be notified in a timely manner of the claim, and Bang Cookies must have sole control of the defense and settlement of the claim. The franchisee must also be in compliance with the Franchise Agreement and, if applicable, the Multi-Unit Development Agreement.
For a Bang Cookies franchisee, this means that if a third party claims the franchisee's use of the Bang Cookies Licensed Marks infringes on their trademark rights, Bang Cookies will cover the franchisee's direct damages, but only if the franchisee has followed all the rules. This includes using the trademarks as specified in the Franchise Agreement, the manuals, and any written instructions from Bang Cookies.
It's important to note that if Bang Cookies defends the claim, they are not obligated to cover any attorney fees the franchisee might incur by hiring their own lawyer. This highlights the importance of adhering to Bang Cookies's guidelines for trademark usage and promptly reporting any potential claims to ensure Bang Cookies can effectively manage the defense. The franchisee must allow Bang Cookies to control the defense and settlement of the claim.