Does Buff City Soap have an obligation to defend a franchisee in a proceeding involving a licensed Mark?
Buff_City_Soap Franchise · 2025 FDDAnswer from 2025 FDD Document
We do not have any obligation to take any affirmative action, participate in your defense, or indemnify you for expenses or damages if you become a party to an administrative or judicial proceeding involving a Mark we license to you or if the proceeding is resolved unfavorably to you. We may, at any time, at our sole option, require you to use any additional or alternative Marks or other intellectual property. If we deem it advisable to modify or discontinue the use of any Mark or other intellectual property and/or use one or more additional, alternative or substitute trade or service marks, you will comply with our directions within a reasonable time after receiving notice from us. You will be responsible for all costs and expenses relating to the modification or discontinuance of the use of any Mark, other intellectual property and/or the use of one or more additional, alternative or substitute trade or service marks. You do not have any rights under the franchise agreement if we require you to modify or discontinue using a trademark.
Source: Item 13 — TRADEMARKS (FDD pages 46–48)
What This Means (2025 FDD)
According to the 2025 Buff City Soap Franchise Disclosure Document, Buff City Soap has no obligation to defend a franchisee in an administrative or judicial proceeding involving a licensed Mark. The FDD states that Buff City Soap is not required to take affirmative action, participate in the franchisee's defense, or indemnify them for expenses or damages if they become involved in such a proceeding, even if the outcome is unfavorable to the franchisee. However, Buff City Soap may, at its sole option, require the franchisee to use additional or alternative Marks or other intellectual property.
If Buff City Soap deems it advisable to modify or discontinue the use of any Mark or other intellectual property, or to use additional, alternative, or substitute trade or service marks, the franchisee must comply with Buff City Soap's directions within a reasonable time after receiving notice. The franchisee will be responsible for all costs and expenses related to these modifications or discontinuations. The franchise agreement does not provide franchisees with any rights if Buff City Soap requires them to modify or discontinue using a trademark.
This lack of obligation on Buff City Soap's part places the financial burden and responsibility of defending against legal challenges related to the Marks on the franchisee. It is important for prospective franchisees to understand this aspect of the agreement and to consider the potential costs and risks associated with trademark-related legal proceedings. Franchisees should also be aware that Buff City Soap has the right to modify or discontinue the use of any Mark, which could impact the franchisee's business and marketing efforts.