What is Bonchon's required action if they seek indemnification from Stripe for an IP Claim?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
- (c) Process. You must promptly notify Stripe of the IP Claim for which you seek indemnification; however, any delay or failure to notify will not relieve Stripe of its obligations under this Section 11, except to the extent Stripe has been prejudiced by the delay or failure. You must give Stripe sole control and authority to defend and settle the IP Claim, but (i) you may participate in the defense and settlement of the IP Claim with counsel of your own choosing at your own expense; and (ii) Stripe will not enter into any settlement that imposes any obligation on you (other than payment of money, which Stripe will pay) without your consent. You must reasonably assist Stripe in defending the IP Claim.
- (d) Other Stripe Actions. Stripe may in its discretion and at no additional expense to you:
- (i) modify the Stripe Technology or Services so that they are no longer claimed to infringe or misappropriate IP Rights of a third party;
- (ii) replace the affected Stripe Technology or Services with a non-infringing alternative;
- (iii) obtain a license for you to continue to use the affected Stripe Technology, Services, or Mark; or
- (iv) terminate your use of the affected Stripe Technology, Services, or Mark upon 30 days' notice.
- (e) Exclusive Remedy. This Section 11.1 states Stripe's sole liability, and your sole and exclusive right and remedy, for infringement by the Stripe Technology, Services, or Marks of a Stripe Entity, including any IP Claim.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, if a franchisee seeks indemnification from Stripe for an IP Claim, the franchisee must promptly notify Stripe of the IP Claim. However, any delay or failure to notify will not relieve Stripe of its obligations, unless Stripe has been prejudiced by the delay or failure. The franchisee must give Stripe sole control and authority to defend and settle the IP Claim.
The franchisee has the option to participate in the defense and settlement of the IP Claim with their own counsel, but at their own expense. Stripe is restricted from entering into any settlement that imposes any obligation on the franchisee (other than payment of money, which Stripe will pay) without the franchisee's consent. The franchisee is obligated to reasonably assist Stripe in defending the IP Claim.
This means that Bonchon franchisees need to be proactive in informing Stripe of any potential IP claims to ensure they can benefit from Stripe's indemnification. While franchisees can be involved in the legal process, Stripe ultimately has the final say in how the claim is handled, provided they do not impose obligations (beyond monetary payments) on the franchisee without consent.
Stripe's actions may include modifying the Stripe Technology or Services, replacing the affected technology with a non-infringing alternative, obtaining a license for the franchisee to continue using the affected technology, or terminating the franchisee's use of the affected technology with 30 days' notice. This section specifies that Stripe's sole liability, and the franchisee's sole and exclusive right and remedy, for infringement by the Stripe Technology, Services, or Marks of a Stripe Entity, including any IP Claim.