Under what conditions will Best Brains indemnify a franchisee for trademark infringement?
Best_Brains Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Indemnification. If your use of any Marks in compliance with this Agreement is held to constitute trademark infringement, unfair competition, or dilution, we will indemnify you for all damages for which you are held liable. We will also reimburse you for all costs reasonably incurred in the defense of any such claim provided that a) you timely notified us of such claim or proceeding, b) You otherwise complied with this Agreement and, c) We have the right to defend any such claim.
If we undertake to defend such claim, then we have no obligation to indemnify or reimburse you for any fees or disbursements of counsel you retain.
Source: Item 23 — RECEIPTS (FDD pages 42–190)
What This Means (2025 FDD)
According to Best Brains' 2025 Franchise Disclosure Document, Best Brains will indemnify a franchisee if the franchisee's use of any Marks in compliance with the Franchise Agreement is held to constitute trademark infringement, unfair competition, or dilution. In such cases, Best Brains will cover all damages for which the franchisee is held liable.
However, this indemnification is conditional. The franchisee must have a) timely notified Best Brains of such claim or proceeding, b) complied with the Franchise Agreement, and c) given Best Brains the right to defend any such claim. If Best Brains chooses to defend the claim, they are not obligated to reimburse the franchisee for any fees or disbursements of counsel the franchisee retains.
In summary, a Best Brains franchisee is protected from trademark infringement liabilities as long as they adhere to the agreement, promptly report any claims, and allow Best Brains to handle the legal defense. This type of clause is relatively standard in franchising, as it allows the franchisor to maintain control over brand-related legal matters while offering some financial protection to franchisees operating under the established brand.