Does the Trademark Agreement between Homemade and Ben Jerrys include provisions for termination in the event of default?
Ben_Jerrys Franchise · 2025 FDDAnswer from 2025 FDD Document
Our right to use and license others to use the Proprietary Marks is exercised through a trademark license agreement with Homemade (the "Trademark Agreement"). Under the Trademark Agreement, we are granted the right to use and to permit others to use the Proprietary Marks. The initial term of the Trademark Agreement is for ten years, and with the right to extend the agreements for additional terms of ten years. The Trademark Agreement does not include any provisions related to termination in the event of default. In the event that we were ever to lose our rights to the Proprietary Marks, Homemade is required under the Trademark Agreement to allow our franchisees to maintain their rights to use the Proprietary Marks in accordance with their franchise agreements (including during any renewal period for which franchisees qualify under their existing agreements). Other than the Trademark Agreements, there are no agreements currently in effect which limit our rights to use or license the use of any Proprietary Mark. As earlier described, in addition to the principal marks listed above in this item, we typically use additional trademarks, service marks and other logos as part of the System, including trademarks for identifying various flavors of ice cream as we specify from time to time. For one trademark we currently use for an ice cream flavor, we have provided a third party with a limited and nonexclusive license to use the trademark in connection with clothing.
Source: Item 13 — TRADEMARKS (FDD pages 64–65)
What This Means (2025 FDD)
According to Ben Jerrys's 2025 Franchise Disclosure Document, the Trademark Agreement between Homemade and Ben Jerrys does not include provisions for termination in the event of default. The Trademark Agreement grants Ben Jerrys the right to use and permit others to use the Proprietary Marks. The initial term of this agreement is ten years, with the option to extend for additional ten-year terms.
Even if Ben Jerrys were to lose its rights to the Proprietary Marks, Homemade is obligated under the Trademark Agreement to allow Ben Jerrys franchisees to maintain their rights to use the Proprietary Marks according to their franchise agreements, including any renewal periods they qualify for under their existing agreements. This provides a level of security for franchisees, ensuring they can continue using the brand's trademarks even if the overarching agreement between Ben Jerrys and Homemade changes.
This arrangement is somewhat unusual, as many trademark agreements include clauses that allow for termination due to default. The absence of such a clause in the Ben Jerrys agreement could be seen as both a benefit and a risk. It offers franchisees stability in trademark usage but may also limit Ben Jerrys's ability to control the brand if Homemade fails to uphold its obligations. Prospective franchisees should carefully consider this aspect and discuss it with Ben Jerrys to fully understand the implications.