Is a Bhc franchisee permitted to engage in any conduct that impairs the goodwill associated with the Marks?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
Furthermore, Franchisee and Franchisee's employees and agents will not engage in any act or conduct that impairs the goodwill associated with the Marks.
- (d) Franchisee agrees to indemnify and hold harmless Franchisor from all "Losses" (as defined in section 16.2(d) below), which Franchisor may sustain as a result of any unauthorized use or disclosure of Proprietary Information or Marks by Franchisee or its employees and agents.
Franchisee further agrees and acknowledges that the disclosure or use of Proprietary Information or Marks in a manner not authorized by this Agreement will cause immediate and irreparable damage to Franchisor that would be impossible or inadequate to measure and calculate and could not be fully remedied by monetary damages.
Accordingly, Franchisor has the right to specifically enforce this Agreement and seek injunctive or other equitable relief as may be necessary or appropriate to prevent such unauthorized disclosures or use without the necessity of proving actual damages by reason of any such breach or threatened breach of this Agreement.
Franchisee further agrees that no bond or other form of security is required to obtain such equitable relief and Franchisee hereby consents to the issuance of such injunction and to the ordering of specific performance.
Franchisee further agrees and acknowledges that such remedies are in addition to any other rights or remedies, whether at law or in equity, which may be available to Franchisor, including monetary damages.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, franchisees are explicitly prohibited from engaging in any conduct that could harm the goodwill associated with the Bhc Marks. The franchise agreement states that franchisees and their employees/agents will not take any actions that impair the goodwill of the Marks. This restriction is in place to protect the brand's reputation and image. Bhc retains exclusive ownership of its Marks and associated goodwill. Franchisees only have a limited license to use the Marks during the term of their agreement. All benefits from the use of the Marks accrue to Bhc.
Bhc emphasizes the importance of protecting its proprietary information and Marks. Unauthorized use or disclosure can cause immediate and irreparable damage to Bhc. The company has the right to seek injunctive relief to prevent any unauthorized use, without needing to prove actual damages. This means Bhc can take legal action to stop a franchisee from misusing the Marks, even if the financial impact isn't yet clear. Franchisees also agree that no bond or security is required for Bhc to obtain this type of legal action, and they consent to the issuance of an injunction.
After the franchise agreement expires or terminates, the franchisee must immediately stop using the Bhc Marks. They cannot operate under any name that might suggest an affiliation with Bhc. This includes actions like repainting the business premises and removing distinctive elements of the trade dress. The franchisee is also responsible for contacting online review sites to remove any references to the Bhc trademarks and reviews from the time they operated as a Bhc franchise. These measures ensure a clean break and prevent any confusion in the marketplace after the franchise relationship ends.