What is the scope of the nondisparagement clause in terms of communication methods for Bigfoot Forestry franchisees?
Bigfoot_Forestry Franchise · 2025 FDDAnswer from 2025 FDD Document
"Prohibited Activities" means and includes any of the following: (a) owning, operating or having any other interest (e.g., as a director, officer, employee, manager, consultant, creditor, representative, agent or in any similar capacity) in a Competing Business, other than owning less than 5% of the Equity Interests in a Competing Business that is a publicly-traded company; (b) disparaging or otherwise making negative comments about us, our affiliate, the System or any Bigfoot Forestry Business (this provision does not prohibit disclosure of truthful information to Governmental Authorities); (c) diverting or attempting to divert any business from us, our affiliate or another franchisee; and/or (d) inducing any Person to transfer their business from a Bigfoot Forestry Business to a competitor.
Source: Item 23 — RECEIPT (FDD pages 42–162)
What This Means (2025 FDD)
According to Bigfoot Forestry's 2025 Franchise Disclosure Document, franchisees are prohibited from disparaging the company, its affiliates, the Bigfoot Forestry System, or any Bigfoot Forestry Business. This restriction extends to "making negative comments," which suggests a broad scope covering various forms of communication. However, the clause explicitly allows for the disclosure of truthful information to Governmental Authorities, providing a specific exception to the nondisparagement requirement.
The nondisparagement clause does not explicitly define the communication methods that it covers. It is reasonable to interpret "making negative comments" as applying to both verbal and written communications, including online reviews, social media posts, public statements, and internal communications within the Bigfoot Forestry network. The absence of specific limitations on communication channels implies that franchisees must exercise caution in all forms of communication to avoid violating the agreement.
While the clause aims to protect Bigfoot Forestry's reputation, it also acknowledges the importance of transparency and compliance with legal obligations by allowing franchisees to provide truthful information to government entities. This balance is typical in franchise agreements, where franchisors seek to maintain brand standards while respecting franchisees' rights and obligations. Prospective franchisees should carefully consider the implications of this clause and seek clarification from Bigfoot Forestry regarding any specific concerns about its scope or application.