What rights does Ben Jerrys retain under the Franchise Agreement and Development Agreement that are not specifically granted to the franchisee?
Ben_Jerrys Franchise · 2025 FDDAnswer from 2025 FDD Document
Our Reserved Rights (Franchise Agreement and Development Agreement): Under the Franchise Agreement and Development Agreement, we and our affiliates retain all the rights that we do not specifically grant to you. Among the rights that we retain are the following (the following list is only for purposes of illustration and is not meant to limit our rights):
(1) We may own, acquire, establish, and/or operate and license others to establish and operate businesses, including Shops operating under the Proprietary Marks and the System selling the Products at any location outside your Territory or Development Area regardless of their proximity to, or potential impact on, your Territory or Development Area or Shops.
(2) We may own, acquire, establish and/or operate and license others to establish and operate, businesses under the Proprietary Marks, at any location within or outside the Territory or Development Area, and which may be similar to your Shop, but which do not operate under the System and are not operating as retail scooped ice cream, sorbet and/or frozen yogurt businesses (this does not limit our rights under paragraph 3 below).
(3) We may own, acquire, establish, and/or operate and license others to establish and operate, Shops under the Proprietary Marks at special or limited purpose, limited access, or captive audience facilities, and other types of institutional accounts (which include airports and other public transportation facilities, parks, stadiums, business and industrial and military complexes, educational facilities, hospitals and other facilities, theaters, museums, art centers, and amusement centers (collectively, "Institutional Facilities") at any location within or outside the Territory or Development Area.
(4) We may acquire, own and/or operate, and license others to operate, businesses under other proprietary marks and other systems, whether the businesses are similar or different from your Shop, at any location within or outside your Territory or Development Area.
(5) We may give, donate, or contribute Products to charitable and community organizations and events for fund raising and other events and use the Products for promotions and product demonstrations in your Territory or Development Area, and offer Products for sampling by consumers and organizations for product testing, promotions and demonstrations in your Territory or Development Area.
(6) We may sell or distribute, or license others to sell or distribute, at, to and/or from any location or site (whether real or virtual and notwithstanding the proximity to your Authorized Location), and whether within or outside your Territory or Development Area, any products (including any Products), whether or not under, in connection with, or bearing any or all of the Proprietary Marks, and whether or not pre-packaged and whether sold or distributed for onpremises consumption, take-out or delivery.
Source: Item 12 — TERRITORY (FDD pages 60–64)
What This Means (2025 FDD)
According to Ben Jerrys's 2025 Franchise Disclosure Document, Ben Jerrys retains all rights not explicitly granted to the franchisee under both the Franchise Agreement and the Development Agreement. These retained rights allow Ben Jerrys to operate and license others to operate businesses, including Ben Jerrys shops, outside the franchisee's territory or development area. This means that Ben Jerrys can establish shops that sell the same products as the franchisee, potentially impacting the franchisee's business, without violating the agreement.
Ben Jerrys also retains the right to operate shops under the Ben & Jerry's name at special, limited-access facilities like airports, parks, stadiums, educational facilities, and hospitals, regardless of their location relative to the franchisee's territory. Additionally, Ben Jerrys can operate businesses under other brands, whether similar to or different from the franchisee's shop, without restriction. This broad reservation of rights allows Ben Jerrys to diversify its operations and brand presence without being limited by individual franchise agreements.
Furthermore, Ben Jerrys reserves the right to donate products to charitable organizations, use products for promotions, and offer samples within the franchisee's territory. Ben Jerrys can also sell or distribute any products, including those under the Ben & Jerry's name, from any location, whether physical or virtual, inside or outside the franchisee's territory. These rights enable Ben Jerrys to conduct marketing and sales activities independently of its franchisees, maintaining control over brand promotion and product distribution.
These retained rights are common in franchising, allowing the franchisor to maintain flexibility and control over the brand's development and market presence. However, prospective Ben Jerrys franchisees should carefully consider these rights and how they might impact their business, particularly in terms of competition and marketing efforts within their territory.