Does Beard Papas have the discretion to refrain from taking action regarding trademark infringement claims?
Beard_Papas Franchise · 2025 FDDAnswer from 2025 FDD Document
You are required to provide us with written notice of any claims that you may become aware of respecting the Licensed Marks including your use of the Licensed Marks and/or any claim associated with a third party's use of a trademark that is identical or confusingly similar to the Licensed Marks. We maintain the exclusive discretion to take any and all actions, or to refrain from any action, that we believe to be appropriate in response to any trademark infringement, challenge or claim. As between us, we possess the sole right to exclusively control any and all litigation, legal proceedings, administrative proceedings and/or settlement(s) involving any actual or alleged infringement, challenge or claim relating to the Licensed Marks. You must sign all documents, instruments and agreements and undertake the actions that we, with
the advice of our legal counsel, determine to be necessary or advisable for the protection and/or maintenance of our interests in the Licensed Marks in any legal proceeding, administrative proceeding or as may be otherwise determined by us. As to the foregoing, we will reimburse you for the reasonable out-of-pocket administrative expenses that you incur and pay in complying with our written instructions.
Source: Item 13 — TRADEMARKS (FDD pages 40–42)
What This Means (2025 FDD)
According to Beard Papas's 2025 Franchise Disclosure Document, Beard Papas maintains the exclusive discretion to take or refrain from taking action regarding trademark infringement claims. Specifically, Beard Papas has the authority to decide whether or not to act in response to any trademark infringement, challenge, or claim related to the Licensed Marks. This means that while franchisees are required to notify Beard Papas of any potential infringement, the company ultimately decides how to respond.
This discretion extends to controlling any litigation, legal proceedings, administrative proceedings, and settlements related to the Licensed Marks. As a franchisee, you are obligated to sign documents and undertake actions that Beard Papas deems necessary for protecting their interests in the Licensed Marks. However, Beard Papas will reimburse franchisees for reasonable out-of-pocket administrative expenses incurred while complying with their written instructions.
While Beard Papas will protect a franchisee's right to use the Licensed Marks and defend against infringement claims, this protection is conditional. Franchisees must use the Licensed Marks according to the Franchise Agreement, manuals, and written instructions. Franchisees must also notify Beard Papas of any claim and give them sole control of the defense and settlement. Failure to comply with these conditions could void Beard Papas's obligation to defend and indemnify the franchisee. This is a fairly standard arrangement in franchising, as franchisors typically want to maintain tight control over their brand and trademarks.
In the event that a third party establishes superior rights to the Licensed Marks, Beard Papas may modify or replace the Licensed Marks. If this occurs, franchisees are required to use the substitutions or variations designated by Beard Papas. In such cases, Beard Papas's sole obligation is to reimburse the franchisee for direct out-of-pocket costs of complying with this obligation, such as alterations in signage and replacement of marketing materials, provided these costs are documented to Beard Papas's satisfaction.