Is a Bhc master franchisee allowed to use the Marks in connection with any business outside the scope of the franchised business?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
Neither Master Franchisee nor any Principal Equity Operator nor any employee, agent, or representative thereof may use or display the Marks and Intellectual Property in connection with the operation of any business or other activity that is outside the scope of the Franchised Business. Master Franchisee may only use the Marks and Intellectual Property on the Internet or other electronic media in the manner and as specifically authorized by Franchisor in the Operations Manual or otherwise in writing. Master Franchisee agrees to be responsible for and supervise all its employees and agents to insure the proper use of the Marks and Intellectual Property in compliance with this Agreement.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, a Master Franchisee is explicitly restricted from using Bhc's Marks and Intellectual Property in connection with any business or activity outside the scope of the franchised Bhc business. The Master Franchisee is only granted the right to use and display the Marks in connection with the operation of the Franchised Business at the Master Franchise Bhc Restaurant and within the designated Territory. Any use of the Marks on the Internet or other electronic media must be specifically authorized by Bhc in the Operations Manual or in writing.
This restriction ensures that the Bhc brand and its associated intellectual property are exclusively used for the promotion and operation of authorized Bhc restaurants, maintaining brand consistency and quality control. Master Franchisees are responsible for supervising their employees and agents to ensure proper use of the Marks and Intellectual Property in compliance with the franchise agreement. Unauthorized use of the Marks constitutes an infringement of the rights of the owner of the Marks and Bhc.
Furthermore, the agreement emphasizes that the Master Franchisee's use of the Marks is a temporary authorization under the agreement, and all ownership interests and goodwill generated by the Marks remain with the owner of the Marks and Bhc. This prevents Master Franchisees from claiming any rights to the brand's goodwill or reputation due to their use of the Marks. Bhc also retains the right to use the name, image, and likeness of the Master Franchisee and its Principal Equity Operators for commercial purposes in connection with marketing and promotion without compensation.
Upon termination or expiration of the franchise agreement, the Master Franchisee must immediately discontinue all use of the Marks and cannot operate under any name that might suggest association with Bhc. This includes actions such as repainting the business premises and removing distinctive elements of the Trade Dress. The Master Franchisee must also request the removal of all trademark references from online review sites and directories related to the former Bhc restaurant. These measures are in place to protect Bhc's brand identity and prevent any confusion or misrepresentation after the franchise relationship ends.