Does Body Brain Center have fiduciary obligations regarding the administration of the advertising fund?
Body_Brain_Center Franchise · 2025 FDDAnswer from 2025 FDD Document
Our administration of the advertising fund isintended to maximize general public recognition and patronage of the Body & Brain System for the benefit of us and all Body & Brain franchisees and we will use our best efforts to apportion advertising to obtain the greatest benefit for all franchisees. We will direct and have complete control and discretion over all advertising programs, including the creative concepts, materials, endorsements and media used for the programs, and the placement and allocation of the programs. We anticipate that the advertising will primarily consist of Internet ads and brochures. We assume no direct or indirect liability or obligation to you with respect to the maintenance, direction or administration of the advertising fund. The advertising fund will not be a trust and we will have no fiduciary obligations with respect to our administration of the advertising fund. An unaudited financial accounting of the operations of the advertising fund will be prepared annually and made available to you upon request.
Source: Item 11 — FRANCHISOR'S ASSISTANCE**, ADVERTISING, **COMPUTER SYSTEMS AND TRAINING (FDD pages 20–29)
What This Means (2025 FDD)
According to Body & Brain Center's 2025 Franchise Disclosure Document, Body & Brain Center does not have fiduciary obligations with respect to its administration of the advertising fund. The FDD states clearly that the advertising fund will not be a trust.
The advertising fund is intended to maximize public recognition of the Body & Brain System for the benefit of both the franchisor and all franchisees. Body & Brain Center has complete control and discretion over all advertising programs, including creative content, materials, endorsements, and media used. The advertising will primarily consist of Internet ads and brochures.
An unaudited financial accounting of the advertising fund's operations will be prepared annually and made available to franchisees upon request. This provides some transparency, even though there is no fiduciary duty. While Body & Brain Center aims to apportion advertising to benefit all franchisees, they assume no direct or indirect liability or obligation to franchisees regarding the advertising fund's maintenance, direction, or administration.