What is the definition of 'Intellectual Property' as it relates to 'Confidential Information' for a Bhc franchise?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
nufacturing of fried chicken, sandwich, and other products offered in BHC Restaurants and which constitute 10% or more of the gross retail sales of any BHC Restaurant.
- "Confidential Information" means information, know-how, and materials that are of value to Franchisor (or other third party, as applicable) and treated as confidential by Franchisor and is disclosed or made known or available to Master Franchisee or its employees or agents. Without limiting the generality of the foregoing, the term "Confidential Information" includes, without limitation: (i) the Operations Manual; (ii) all technical and non-technical information, including without limitation, information concerning finances, financing and capital raising plans, accounting or marketing, business opportunities, affiliate lists, business plans, forecasts, predictions, projections, recipes, products, research, development, and know-how; (iii) "Intellectual Property" (as defined in this Article 1), the Marks, BHC Products, insignias, designs, and materials subject to copyright, patent, or trademark registration; (iv) any developments, inventions, improvements, additions, modifications, enhancements, derivatives, ideas, reports, analyses, opinions, studies, data or other materials or work product, whether prepared by Franchisor or otherwise, that contain or are based upon the proprietary information; (v) information regarding customers and potential customers of the Franchised Business, including customer lists, names, needs or desires with respect to the products or services offered, contracts and their contents and parties, the type and quantity of products and services provided or sought to be provided to customers and potential customers of the Franchised Business and other non-public information relating to customers and potential customers; (vi) information regarding any of Franchisor's business partners or affiliates and their services, including names, representatives, proposals, bids, contracts and their contents and parties, the type and quantity of products and services received by the discloser, and other non-public information relating to business partners; (vii) information regarding personnel, including compensation and personnel files; and (viii) any other non-public information that a competitor of Franchisor could use to the competitive disadvantage of Franchisor.
"Control" means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person or entity, whether through the ownership of voting securities, by contract or otherwise.
"Force Majeure." means a natural disaster (such as tornado, earthquake, hurricane, flood, fire or other natural catastrophe); strike, lockout or other industrial disturbance; war, terrorist act, riot, or other civil disturbance; epidemic; pandemic (e.g., COVID-19), or other similar force which Master Franchisee could not by the exercise of reasonable diligence have avoided;
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, Intellectual Property is a component of Confidential Information. Confidential Information includes Intellectual Property, Marks, Bhc Products, insignias, designs, and materials subject to copyright, patent, or trademark registration. Intellectual Property itself is defined as creations of the mind, including inventions, literary and artistic works, designs, symbols, names, and images owned by Bhc and used in the Franchised Business or at the Bhc Restaurant.
This means that as a Bhc franchisee, you are obligated to protect all of these elements as confidential. This obligation extends to the use of the Marks, the recipes for Bhc Products, and any other creative assets associated with the brand. The definition of Intellectual Property also encompasses a broad range of creations, from literary works to designs and symbols, indicating the importance Bhc places on protecting its brand identity and proprietary information.
Bhc also defines "IP Rights" as all past, present, and future rights of the following types, which may exist or be created under the laws of any jurisdiction in the world: (i) rights associated with works of authorship, including exclusive exploitation rights, copyrights and moral rights; (ii) trademark and trade name rights and similar rights; (iii) trade secret rights; (iv) patent and industrial property rights; (v) other proprietary rights in intellectual property of every kind and nature; and (vi) rights in or relating to registrations, renewals, extensions, combinations, divisions, and reissues of, and applications for, any of the rights referred to in clauses (i) through (v) of this paragraph. This definition further emphasizes the comprehensive nature of Bhc's intellectual property protection, covering a wide array of rights and ensuring that the brand's assets are safeguarded across different jurisdictions and throughout time.
For a prospective franchisee, understanding these definitions is crucial. It highlights the importance of maintaining confidentiality and protecting Bhc's Intellectual Property to uphold the integrity of the franchise system. Failure to comply with these requirements could lead to legal repercussions and damage the brand's reputation.