What is the Bhc Master Franchisee prohibited from doing regarding the Marks, during and after the agreement term?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
Master Franchisee agrees that during the term of the Franchise, and after any assignment, expiration or termination of the Franchise, Master Franchisee will not, directly or indirectly, commit an act of infringement or contest or aid others in contesting the validity, distinctiveness, secondary meaning, ownership or enforceability of the Marks or Intellectual Property, or take any other action in derogation of the Marks or Intellectual Property, and that no monetary amount will be assigned as attributable to any goodwill associated with Master Franchisee's use of the System, the Marks or Intellectual Property.
9.1 License of the Marks.
Neither Master Franchisee nor any Principal Equity Operator nor any employee, agent, or representative thereof may use, display, or permit the use or display of trademarks, trade names, service marks, insignias, or logo types other than the Marks and other trademarks and service marks approved for use by Franchisor in connection with the Franchised Business.
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.
(b) Master Franchisee acknowledges and agrees (i) Master Franchisee's use of the Marks and Intellectual Property is a temporary authorized use under this Agreement, (ii) the Owner of the Marks retains all ownership interests in the Marks, and (iii) Franchisor and the Owner of the Marks retain all ownership of the goodwill generated by the Marks.
(d) Master Franchisee further agrees it will not identify itself as (i) Franchisor, (ii) a subsidiary, parent, division, shareholder, partner, joint venture, agent or employee of Franchisor or the Owner of the Marks or (iii) any of Franchisor's other Master Franchisees.
(a) In the event of termination, cancellation or expiration of this Agreement whether by reason of Master Franchisee's breach, default, non-renewal, lapse of time or other cause, in addition to any other obligations provided for in this Agreement, Master Franchisee must forthwith discontinue the use or display of the Marks in any manner whatsoever, and Master Franchisee may not thereafter operate or do business under the Marks or any other BHC brand or any other name or in any manner that might tend to give the general public the impression that Master Franchisee is in any way associated or affiliated with Franchisor, or any of the businesses conducted by Franchisor or the Owner of the Marks, including without limitation repainting the business premises in a distinctively different color and removing or rearranging distinctive elements of the Trade Dress. Master Franchisee must contact online review sites and other online directories and websites which have made reference to Master Franchised BHC Restaurant during the 18 months prior to the date this Agreement terminates, is cancelled, or expires, and request the removal of all use of the trademarks in connection with the former BHC franchised BHC Restaurant (and the physical address of the former BHC Restaurant) and all use of former reviews from the period Master Franchisee was a BHC Master Franchisee.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, the Master Franchisee faces several restrictions regarding the use and protection of Bhc's Marks, both during and after the term of the franchise agreement. During the franchise term, the Master Franchisee cannot use any trademarks, trade names, service marks, insignias, or logo types other than the Marks approved by Bhc. They are also prohibited from using the Marks in connection with any business or activity outside the scope of the Franchised Business, and must properly supervise employees to ensure compliance with the agreement regarding the use of Marks. The Master Franchisee acknowledges that their use of the Marks is a temporary authorization, and all ownership interests and goodwill generated by the Marks remain with the Owner of the Marks and Bhc. The Master Franchisee also cannot identify itself as Franchisor, or any of Franchisor's other Master Franchisees.
After the franchise agreement expires or terminates, the Master Franchisee must immediately discontinue all use of the Marks and cannot operate under any name that might suggest an association with Bhc. This includes repainting the business premises and removing or rearranging distinctive elements of the Trade Dress. The Master Franchisee must also contact online review sites and directories to request the removal of all trademark use and former reviews related to the Bhc Restaurant.
Moreover, the Master Franchisee is prohibited from contesting the validity, distinctiveness, ownership, or enforceability of the Marks or Intellectual Property, or taking any action that could harm the Marks or Intellectual Property, both during and after the agreement. They also cannot claim any monetary amount attributable to goodwill associated with their use of the System, the Marks, or Intellectual Property. These restrictions ensure the protection of Bhc's brand and reputation, preventing any potential confusion or misuse of the Marks by former franchisees.