Is Burneys Sweets More obligated to participate in a franchisee's defense in infringement proceedings?
Burneys_Sweets_More Franchise · 2025 FDDAnswer from 2025 FDD Document
You must immediately notify us of any unauthorized use of the Marks, any challenge to the validity of the Marks, any claim of apparent infringement or challenge to your use of any Marks, or any challenge to our ownership of, right to use and to license others to use, or your right to use, the Marks. You may not communicate with any person other than us and our counsel in connection with any such infringement, challenge or claim. We have the right to direct and control any administrative proceeding or litigation involving the Marks, including any settlement. We or have the right, but not the obligation, to take action against uses by others that may constitute infringement of the Marks. We may but are not obligated to participate in your defense in infringement proceedings and we are not obligated to protect your rights or defend you against claims of infringement or unfair competition related to use of the Marks. We will indemnify and reimburse you for damages obtained by a third party based on your use of the Marks provided you have at all times fully complied with the Franchise Agreement. However, you would be responsible for any rebranding expenses. If there is any litigation relating to your use of the Marks, you must sign all documents and do all things as may be necessary to carry out a defense or prosecution, including becoming a nominal party to any legal action.
Source: Item 13 — TRADEMARKS (FDD pages 35–37)
What This Means (2025 FDD)
According to Burneys Sweets More's 2025 Franchise Disclosure Document, Burneys Sweets More is not obligated to participate in a franchisee's defense in infringement proceedings. The FDD states that Burneys Sweets More "may but are not obligated to participate in your defense in infringement proceedings and we are not obligated to protect your rights or defend you against claims of infringement or unfair competition related to use of the Marks." However, Burneys Sweets More will indemnify and reimburse a franchisee for damages obtained by a third party based on the franchisee's use of the Marks, provided the franchisee has fully complied with the Franchise Agreement.
This means that if a franchisee is sued for trademark infringement related to their use of the Burneys Sweets More Marks, Burneys Sweets More has the right, but not the obligation, to participate in the defense. If Burneys Sweets More chooses not to participate, the franchisee is responsible for their own legal defense. However, if the franchisee is found liable and has complied with the Franchise Agreement, Burneys Sweets More will cover the damages awarded to the third party. The franchisee would be responsible for any rebranding expenses.
The franchisee is required to notify Burneys Sweets More immediately of any potential trademark issues and to cooperate fully in any legal defense or prosecution, including signing necessary documents and becoming a nominal party to legal actions. This clause highlights the importance of franchisees adhering to the brand standards and usage guidelines provided by Burneys Sweets More to minimize the risk of infringement claims.