Does Black Bear Diner need to post a bond when seeking injunctive relief in court?
Black_Bear_Diner Franchise · 2025 FDDAnswer from 2025 FDD Document
As any breach by Developer of any of the covenants contained in this section would result in irreparable injury to Franchisor, and as the damages arising out of any such breach would be difficult to ascertain, Developer agrees that, in addition to all other remedies provided by law or in equity, Franchisor shall be entitled to an injunction prohibiting any conduct by Developer in violation of this Section 10.
Source: Item 23 — RECEIPT (FDD pages 56–243)
What This Means (2025 FDD)
According to the 2025 Black Bear Diner Franchise Disclosure Document, if a developer breaches any of the covenants related to non-competition, Black Bear Diner is entitled to seek an injunction against the developer. The FDD states that because such a breach would result in irreparable injury to Black Bear Diner, and because the damages would be difficult to ascertain, Black Bear Diner is entitled to an injunction prohibiting the conduct. The FDD does not state that Black Bear Diner is required to post a bond when seeking such injunctive relief.
This means that Black Bear Diner believes that any violation of the non-compete agreements by a developer would cause significant and unquantifiable harm to the franchise. Therefore, Black Bear Diner retains the right to ask a court to immediately stop any such violation through an injunction.
Typically, a court might require the party seeking an injunction (in this case, Black Bear Diner) to post a bond. This bond would act as a form of security, ensuring that the party being enjoined (the developer) is compensated if the injunction is later found to be unjustified. However, the Black Bear Diner franchise agreement does not mention any requirement for Black Bear Diner to post a bond. This could potentially benefit Black Bear Diner, as it would reduce the financial burden of obtaining an injunction.