What written actions must a Buona franchisee take upon receiving notice of a trademark threat?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
- A. delivers to Franchisor prompt written notice of the threat;
- B. grants Franchisor written authorization to take unrestricted control over the defense and settlement of the threat with counsel of its choice;
- C. did not cause or give rise to the threat due to a material failure to comply with Franchisor's previously communicated trademark usage requirements;
- D. cooperates promptly and fully with Franchisor in the defense, mitigation, and/or settlement of the threat; and
- E. does not jeopardize or compromise any right, defense, obligation or liability of Franchisor, by making any statement to, or entering into any agreement with, the threatening party which does not have the advance written consent of Franchisor, unless required by applicable law."
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, if a franchisee receives notice of a trademark threat, they must take specific written actions. The franchisee must deliver prompt written notice of the threat to Buona. Additionally, the franchisee is required to grant Buona written authorization to take unrestricted control over the defense and settlement of the threat, allowing Buona to choose its own legal counsel for the matter.
These requirements ensure that Buona maintains control over its trademarks and can act swiftly and decisively to protect its brand. By requiring written notice and authorization, Buona ensures clear communication and a formal transfer of authority, which is essential for effective trademark protection. This also prevents franchisees from taking actions that could potentially harm the brand or compromise Buona's legal position.
However, the franchisee is only obligated to take these actions if they did not cause or contribute to the trademark threat through a failure to comply with Buona's previously communicated trademark usage requirements. Furthermore, the franchisee must cooperate fully with Buona in the defense, mitigation, and/or settlement of the threat. The franchisee must also refrain from making any statements or entering into any agreements with the threatening party without Buona's advance written consent, unless required by applicable law, to protect Buona's rights and legal strategies.