Under what condition will Beauty Bungalows indemnify a franchisee for claims of infringement or challenges?

According to Beauty Bungalows's 2025 Franchise Disclosure Document, Beauty Bungalows will indemnify a franchisee for claims of infringement or challenges if the claims result from the franchisee's approved use of Beauty Bungalows's marks, in accordance with the Franchise Agreement. This means that as long as the franchisee is using the trademarks in a manner that Beauty Bungalows has approved, and as outlined in the Franchise Agreement, Beauty Bungalows will cover any legal costs or settlements resulting from trademark disputes. Beauty Bungalows will also be responsible for the defense and the cost thereof.

However, Beauty Bungalows will not indemnify or defend a franchisee if the infringement claim arises from the franchisee's unapproved use of the marks. This includes any usage that deviates from the Franchise Agreement or the manuals provided by Beauty Bungalows. Therefore, it is crucial for franchisees to adhere strictly to the guidelines provided by Beauty Bungalows regarding trademark usage to ensure they are protected under the indemnity.

This condition is fairly standard in franchising. Franchisors typically protect franchisees who follow the brand's guidelines, but they do not cover legal issues arising from unauthorized use of intellectual property. For a prospective Beauty Bungalows franchisee, this underscores the importance of understanding and complying with all brand standards related to trademark usage, as outlined in the Franchise Agreement and operational manuals.