Is Beggars Pizza obligated to take action against infringement of the Proprietary Marks?
Beggars_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
You must promptly notify us of any suspected unauthorized use of the Proprietary Marks, any challenge to the validity of the Proprietary Marks, or any challenge to our ownership of or right to use and to license others to use the Proprietary Marks. We have the sole right to direct and control any administrative proceeding or litigation involving the Proprietary Marks including any settlement. We have the right, but not the obligation, to take action against uses by others that may constitute infringement of the Proprietary Marks. We will defend you against any third-party claim, suit, or demand arising out of your use of the Proprietary Marks in strict compliance with the Manuals. If we determine that you have used the Proprietary Marks in accordance with your Franchise Agreement in our sole discretion, we will bear the cost of your defense including the cost of any judgment or settlement; however, if we determine in our sole discretion that you have not used the Proprietary Marks in accordance with your Franchise Agreement, the cost of your defense will be your responsibility including the cost of any judgment or settlement. In any
litigation relating to your use of the Proprietary Marks, you must sign all documents and do such acts as we may require to carry out your defense or prosecution, including becoming a nominal party to any legal action. We will reimburse you for your out-of-pocket expenses for these acts except to the extent that the litigation is the result of your use of the Proprietary Marks in a manner inconsistent with the terms of your Franchise Agreement.
We may designate new, modified or replacement marks for your use, and require you, at your own expense, to use them in addition to or instead of any of the previously designated Proprietary Marks. These requirements may include, among things, conducting business under a different trade name. Under the Franchise Agreement, you must comply fully with our requirements to modify or discontinue using a trademark.
Source: Item 13 — TRADEMARKS (FDD pages 28–30)
What This Means (2025 FDD)
According to Beggars Pizza's 2025 Franchise Disclosure Document, while franchisees must promptly notify Beggars Pizza of any suspected unauthorized use of its Proprietary Marks, Beggars Pizza is not obligated to take action against uses by others that may constitute infringement of the Proprietary Marks. Instead, Beggars Pizza retains the right, but not the obligation, to take action against potential infringers. Beggars Pizza also has the sole right to direct and control any administrative proceeding or litigation involving the Proprietary Marks, including any settlement.
This means that if a franchisee discovers someone else using the Beggars Pizza trademark without permission, they must inform Beggars Pizza. However, Beggars Pizza has the discretion to decide whether or not to pursue legal action against the infringing party. This decision likely depends on various factors, such as the severity of the infringement, the potential impact on the Beggars Pizza brand, and the resources required to pursue legal action.
Beggars Pizza will defend a franchisee against any third-party claim arising from the franchisee’s use of the Proprietary Marks, provided the franchisee has strictly complied with the operational manuals and franchise agreement. If Beggars Pizza determines the franchisee has used the marks correctly, Beggars Pizza will cover the costs of the defense, including judgments or settlements. However, if Beggars Pizza determines the franchisee did not use the Proprietary Marks in accordance with the Franchise Agreement, the franchisee will be responsible for all defense costs, judgments, and settlements. In any litigation, the franchisee must sign documents and perform acts required for their defense or prosecution, potentially becoming a nominal party to legal action, with Beggars Pizza reimbursing out-of-pocket expenses unless the litigation results from the franchisee's inconsistent use of the marks.
Beggars Pizza can also designate new, modified, or replacement marks, requiring franchisees to use them at their own expense, potentially including conducting business under a different trade name. Franchisees must fully comply with requirements to modify or discontinue using a trademark as per the Franchise Agreement. This could involve updating signage, marketing materials, and other branded items to reflect the new marks.