Is Beard Papas required to indemnify a franchisee for damages or expenses in a proceeding involving a copyright or patent?
Beard_Papas Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor shall indemnify, defend, and hold Franchisee and Franchisee's officers, directors, shareholders, members, owners, partners, agents, representatives, independent contractors, employees, assigns and successors (the "Franchisee Indemnified Parties") harmless from all losses, expenses, claims, causes of action, lawsuits, liabilities, taxes, costs, demands, proceedings, investigations, hearings, and/or damages solely arising out of, or solely relating to, Franchisor's gross negligence in the operation of Franchisee's Beard Papa's Shop that was the direct cause of any such loss, expense, liability or damage provided Franchisee immediately notifies Franchisor of such claim, cause of action, lawsuit, demand, proceeding, investigation or hearing, and Franchisor shall pay all of the Franchisee Indemnified Parties' reasonable
costs, fees and expenses of defending any such claim, cause of action, lawsuit, demand, proceeding, investigation, and/or hearing brought against any of the Franchisee Indemnified Parties or any such claim, cause of action, lawsuit, demand, proceeding, investigation, and/or hearing in which any of the Franchisee Indemnified Parties is named as a party, including, without limitation, reasonable accountant fees, attorney fees, and expert witness fees, court costs, deposition fees, travel expenses and other litigation expenses provided Franchisee immediately notifies Franchisor of such claim, cause of action, lawsuit, demand, proceeding, investigation or hearing. Franchisor agrees that the terms of this Article 10.C. shall survive the termination, expiration or Transfer of this Agreement.
Source: Item 14 — PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION (FDD page 42)
What This Means (2025 FDD)
According to the 2025 Beard Papas Franchise Disclosure Document, Beard Papas offers limited indemnification to franchisees. Specifically, Beard Papas will indemnify, defend, and hold the franchisee harmless from losses, expenses, claims, lawsuits, liabilities, taxes, costs, demands, proceedings, investigations, hearings, and/or damages. However, this indemnification is only applicable if the damages arise solely from Beard Papas's gross negligence in the operation of the franchisee's Beard Papa's Shop and the franchisee immediately notifies Beard Papas of any such claim.
Beard Papas will cover the franchisee's reasonable costs, fees, and expenses of defending any claim, lawsuit, demand, proceeding, or hearing brought against the franchisee. This includes reasonable accountant fees, attorney fees, expert witness fees, court costs, deposition fees, travel expenses, and other litigation expenses. Again, this is contingent on the franchisee immediately notifying Beard Papas of any such claim or legal action.
It is important to note that the indemnification provided by Beard Papas is specifically tied to their own gross negligence in the shop's operation. The FDD does not state that Beard Papas will indemnify a franchisee for claims or expenses arising from copyright or patent infringement. A prospective franchisee should consult with a legal professional to fully understand the scope and limitations of the indemnification provided by Beard Papas and to assess their potential risks related to intellectual property issues.