Does the Bonchon franchise agreement allow a franchisee to contest Bonchon's interest in the Proprietary Marks or other System trade secrets?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
y claim or assertion that we have unreasonably withheld or delayed any consent or approval under this Franchise Agreement. You waive any such claim for damages. You may not claim any such damages by way of setoff, counterclaim or defense. Your sole remedy for the claim will be an action or proceeding to enforce the Agreement provisions, for specific performance or for declaratory judgment.
25. INJUNCTION
25.01 Injunction
You explicitly affirm and recognize the unique value and secondary meaning attached to the Bonchon System and the Proprietary Marks. Accordingly, you agree that any noncompliance by you with the terms of this Agreement, or any unauthorized or improper use of the Bonchon System or the Proprietary Marks by you, will cause irreparable damage to us and other Bonchon System franchisees. You therefore agree that if you engage in this non-compliance, or unauthorized and/or improper use of the Bonchon System or Proprietary Marks, during or after the term of this Agreement, we and our affiliates will be entitled to both temporary and permanent injunctive relief against you from any court of competent jurisdiction, in addition to all other remedies which we may have at law. You consent to the entry of these temporary and permanent injunctions without the requirement that we post a bond of any type or nature, or any other form of security, and without the requirement to prove the adequacy of money damages as a remedy, and without waiving any other rights or remedies at law or in equity.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
Based on the 2025 Bonchon Franchise Disclosure Document, the agreement emphasizes the unique value of Bonchon's system and proprietary marks, requiring franchisees to acknowledge and respect Bonchon's rights to these assets. The agreement does not explicitly state whether a franchisee can contest Bonchon's interest in the Proprietary Marks or other System trade secrets. However, the document outlines several stipulations that imply franchisees have limited rights to challenge Bonchon's ownership or control over these elements.
Specifically, the franchise agreement states that nothing within it constitutes a license for the franchisee to use or display any of Bonchon's Proprietary Marks in any manner, except as explicitly granted in the Franchise Agreements. Furthermore, franchisees are prohibited from using Bonchon's Proprietary Marks or any confusingly similar words or symbols in their entity name. The agreement also emphasizes that any unauthorized or improper use of the Bonchon System or Proprietary Marks will cause irreparable damage to Bonchon and other franchisees, entitling Bonchon to injunctive relief.
Given these stipulations, a prospective franchisee should carefully consider the implications regarding their ability to challenge Bonchon's intellectual property rights. While the FDD does not explicitly prohibit contesting Bonchon's interests, the strong emphasis on protecting Bonchon's Proprietary Marks and System suggests that any such challenge could be viewed unfavorably and potentially lead to legal action. It would be prudent for a potential franchisee to seek legal counsel to fully understand their rights and obligations in this regard.