What is the Bhc Master Franchisee prohibited from engaging in regarding the Marks?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
) 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. Master Franchisee acknowledges that the use of the Marks outside the scope of the terms of this Agreement without Franchisor's written consent is an infringement of the Owner of the Marks' and Franchisor's exclusive right, title, and interest in and to the Marks and Intellectual Property. Master Franchisee agrees that as between Master Franchisee and Franchisor, all rights to use the Marks and Intellectual Property within the franchised System are Franchisor's exclusive property. Master Franchisee now asserts no claim and will hereafter assert no claim to any goodwill, reputation, or ownership thereof because of Master Franchisee's use thereof or otherwise. It is expressly understood and agreed that ownership and title of the Trade Dress, Operations Manual and Franchisor's other manuals, bulletins, instruction sheets, forms, methods of operation and goodwill are and, as between Master Franchisee and Franchisor, remain vested solely in Franchisor, and the use thereof is only co-extensive with the term of this Agreement.
- (c) 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.
- (d) Master Franchisee hereby grants Franchisor the right at any time to use the name, image and likeness of Master Franchisee and all Principal Equity Operators for commercial purposes in connection with the marketing and promotion of the Marks, Franchisor's Intellectual Property, BHC Products, any BHC business location and the System, without any form of compensation or remuneration.
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 restricted in several ways regarding the use of Bhc's Marks. The Master Franchisee cannot use the Marks outside the specific terms outlined in the Franchise Agreement without obtaining prior written consent from Bhc. Any unauthorized use is considered an infringement on Bhc's rights to the Marks and Intellectual Property. The Master Franchisee also cannot assert any claim to the goodwill, reputation, or ownership of the Marks due to their use of them.
Furthermore, the Master Franchisee is prohibited from contesting the validity, distinctiveness, ownership, or enforceability of the Marks or Intellectual Property during and after the franchise term. They also cannot take any action that could harm the Marks or Intellectual Property. The agreement explicitly states that all rights to use the Marks and Intellectual Property within the franchised System are Bhc's exclusive property.
In addition to these restrictions, the Master Franchisee cannot use Bhc's Marks, operational techniques, service concepts, or proprietary information in connection with any businesses or services other than the franchised Bhc Restaurant without express prior written permission from Bhc. If permission is granted, those businesses or services become part of the franchised business and are subject to royalty and marketing and promotion fees. This ensures that the Master Franchisee focuses on developing the Bhc business and does not divert resources or the brand's reputation to other ventures without proper authorization and compensation to Bhc.