What is a Bonchon franchisee's obligation if they learn of a claim against them for alleged trademark infringement?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
We have the right to control any administrative proceedings or litigation involving a trademark licensed by us to you. If you learn of any claim against you for alleged infringement, unfair competition, or similar claims about the Proprietary Marks, you must promptly notify us. We will promptly take the action we consider necessary to defend you. We must indemnify you for any action against you by a third party based solely on alleged infringement, unfair competition, or similar claims about the Proprietary Marks. You may not settle or compromise any of these claims without our previous written consent. We will have the right to defend and settle any claim at our sole expense, using our own counsel. You must cooperate with us in the defense. Under the Franchise Agreement, you irrevocably grant us authority to defend or settle these claims. You may participate at your own expense, but our decisions with regard to the defense or settlement will be final. We will have no obligation to defend or indemnify you if the claim against you relates to your use of the Proprietary Marks in violation of the Franchise Agreement.
Source: Item 13 — TRADEMARKS (FDD pages 65–68)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, if a franchisee becomes aware of a claim against them related to alleged trademark infringement, unfair competition, or similar issues concerning the Proprietary Marks, they must promptly notify Bonchon. Bonchon will then take the necessary actions to defend the franchisee.
Bonchon is obligated to indemnify the franchisee in the event of a third-party action based solely on alleged infringement, unfair competition, or similar claims about the Proprietary Marks. However, the franchisee cannot settle or compromise any claims without Bonchon's prior written consent. Bonchon retains the right to defend and settle any claim at its sole expense, using its own counsel.
The franchisee is required to cooperate with Bonchon in the defense against such claims and has irrevocably granted Bonchon the authority to defend or settle these claims. The franchisee may participate in the defense at their own expense, but Bonchon's decisions regarding the defense or settlement are final. Bonchon has no obligation to defend or indemnify the franchisee if the claim arises from the franchisee's use of the Proprietary Marks in violation of the Franchise Agreement.