Under what conditions will Best Brains indemnify a franchisee against damages for trademark infringement?
Best_Brains Franchise · 2025 FDDAnswer from 2025 FDD Document
We will indemnify you against, and reimburse you for, all damages for which you are held liable in any proceeding in which your use of any Mark, pursuant to and in compliance with the Franchise Agreement, is held to constitute trademark infringement, unfair competition or dilution, and for all costs reasonably incurred by you in the defense of any claim brought against you or in any proceeding in which you are named as a party, provided that you have timely notified us of the claim or proceeding and have otherwise complied with the Franchise Agreement. We, in our discretion, will be entitled to defend any proceeding arising out of your use of any Mark pursuant to the Franchise Agreement, and, if we undertake the defense of the proceeding, we will have no obligation to indemnify or reimburse you for any fees or disbursements of counsel you retain.
Source: Item 13 — TRADEMARKS (FDD pages 29–30)
What This Means (2025 FDD)
According to Best Brains's 2025 Franchise Disclosure Document, Best Brains will indemnify a franchisee against damages if the franchisee's use of any Best Brains mark, pursuant to and in compliance with the Franchise Agreement, is held to constitute trademark infringement, unfair competition, or dilution. Best Brains will also reimburse the franchisee for all costs reasonably incurred in defending against any claim brought against them or in any proceeding in which they are named as a party.
However, this indemnification is conditional. The franchisee must have provided timely notification of the claim or proceeding to Best Brains and must have otherwise complied with all terms of the Franchise Agreement. If these conditions are met, Best Brains has the right to defend any proceeding arising out of the franchisee's use of any Best Brains mark pursuant to the Franchise Agreement.
If Best Brains chooses to undertake the defense of the proceeding, it will have no obligation to indemnify or reimburse the franchisee for any fees or disbursements of counsel the franchisee retains independently. This means that while Best Brains will cover damages and defense costs if they control the defense, franchisees bear their own legal expenses if they choose separate representation. This is a fairly standard arrangement in franchising, as it allows the franchisor to control the legal strategy and minimize potential damage to the brand.