Under what circumstances does Bumble Roofing not indemnify a franchisee against trademark infringement claims?
Bumble_Roofing Franchise · 2025 FDDAnswer from 2025 FDD Document
The Minnesota Department of Commerce requires that a franchisor indemnify Minnesota Franchisees against liability to third parties resulting from claims by third parties that the franchisee's use of the franchisor's trademark infringes upon the trademark rights of the third party. The franchisor does not indemnify against the consequences of a franchisee's use of a franchisor's trademark except in accordance with the requirements of the franchise agreement, and as the condition to an indemnification, the franchisee must provide notice to the franchisor of any such claim immediately and tender the defense of the claim to the franchisor. If the franchisor accepts tender of defense, the franchisor has the right to manage the defense of the claim, including the right to compromise, settle or otherwise resolve the claim, or to determine whether to appeal a final determination of the claim.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 43–45)
What This Means (2025 FDD)
According to Bumble Roofing's 2025 Franchise Disclosure Document, the franchisor's obligation to indemnify franchisees against trademark infringement claims is subject to specific conditions, particularly for franchisees located in Minnesota. While the Minnesota Department of Commerce mandates that Bumble Roofing protect its Minnesota franchisees from third-party claims arising from trademark infringement, this protection isn't absolute.
Bumble Roofing does not provide indemnification against all consequences related to a franchisee's use of the franchisor's trademark. Instead, Bumble Roofing will only indemnify a franchisee for claims that arise solely from the franchisee's use of the trademarks in accordance with the requirements of the Franchise Agreement and Bumble Roofing's standards. This means that if a franchisee deviates from the approved usage of the trademarks or violates the Franchise Agreement in their use, they may not be covered by the indemnification.
Furthermore, the FDD stipulates that for a franchisee to be eligible for indemnification, they must immediately notify Bumble Roofing of any trademark infringement claim and tender the defense of the claim to the franchisor. If Bumble Roofing accepts the defense, it reserves the right to manage the claim's defense, including decisions on compromise, settlement, resolution, or appeal. Therefore, failure to provide prompt notice and allow Bumble Roofing to control the defense could void the indemnification obligation. This is a fairly standard clause in franchise agreements, as it allows the franchisor to protect the brand and manage legal risks effectively.