To whom can a Bhc franchisee disclose trade secrets in confidence for the purpose of reporting a suspected violation of law?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
(e) 18 USC Section 1833(b) states: "An individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that (A) is made (i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal." Accordingly, Franchisor and Franchisee will each have the right to disclose in confidence Trade Secrets to Federal, State, and local government officials, or to an attorney, for the sole purpose of reporting or investigating a suspected violation of law.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, both the franchisor and the franchisee have the right to disclose trade secrets in confidence under specific circumstances. Specifically, a Bhc franchisee can disclose trade secrets to Federal, State, and local government officials, or to an attorney.
However, this disclosure is only protected if it is solely for the purpose of reporting or investigating a suspected violation of law. Additionally, trade secrets can be disclosed in a document filed in a lawsuit or other proceeding, but only if the filing is made under seal to protect it from public disclosure.
This provision reflects the legal protections provided by 18 U.S.C. Section 1833(b), which aims to encourage the reporting of potential legal violations without fear of liability under trade secret laws. Bhc's franchise agreement explicitly states that nothing within the agreement is intended to conflict with this statute or create liability for disclosures of trade secrets that are expressly allowed by it.