Are there any obligations for Beehive Homes to protect franchisees against unfair competition claims?
Beehive_Homes Franchise · 2025 FDDAnswer from 2025 FDD Document
YOU must notify US in writing of any claim, demand or suit based upon or in connection with any or all rights which YOU have to use the trademarks, service marks, trade names, logotypes or commercial symbols. YOU must also notify US in writing of the use of, or claims of rights to, a trademark identical to or confusingly similar to the names and marks. WE have the right to defend any such claims, demands or suits. However, WE are not obligated by the Franchise Agreement or otherwise to protect YOU against any such claim, demand or suit, nor are WE obligated by the Franchise Agreement or otherwise to protect YOU against claims of infringement or unfair competition. YOU are given the right to protect YOURSELF, at YOUR sole cost, from any claims if WE elect not to.
If at any time it becomes advisable in OUR sole discretion to modify or discontinue any use of the names and marks and/or use one or more additions to or substitutes for the names and marks, YOU will do so and OUR sole obligation will be to reimburse YOU for tangible costs in changing signs and printed matter to comply with this obligation.
Source: Item 13 — TRADEMARKS (FDD pages 22–23)
What This Means (2025 FDD)
According to Beehive Homes' 2025 Franchise Disclosure Document, Beehive Homes is not obligated to protect franchisees against claims of infringement or unfair competition. While franchisees must notify Beehive Homes of any claims or suits related to the use of trademarks, service marks, trade names, logotypes, or commercial symbols, Beehive Homes has the right, but not the obligation, to defend against such claims.
This means that as a Beehive Homes franchisee, you are responsible for protecting yourself, at your own cost, from any claims of infringement or unfair competition if Beehive Homes chooses not to defend you. This could involve legal fees and other expenses associated with defending against such claims.
However, if Beehive Homes decides to modify or discontinue the use of any names and marks, or use additions or substitutes, their sole obligation is to reimburse you for the tangible costs of changing signs and printed matter to comply with this obligation. This provides some limited protection to the franchisee in the event that Beehive Homes changes its branding.
Prospective franchisees should carefully consider the implications of this lack of obligation and factor in the potential costs of defending against claims of infringement or unfair competition when evaluating the Beehive Homes franchise opportunity. It is advisable to consult with an attorney to fully understand your rights and responsibilities in this area.