What is each party's obligation if they learn of any infringement or misappropriation of Camp Margaritaville Intellectual Property?
Camp_Margaritaville Franchise · 2025 FDDAnswer from 2025 FDD Document
- (a) Notification. Each Party shall promptly notify the other Party in writing, if such Party learns that any other Person infringes or misappropriates any Camp Margaritaville Intellectual Property or initiates before any Governmental Authority any proceedings relating to any Camp Margaritaville Intellectual Property which infringement, misappropriation or proceedings would on a commercially reasonable basis be expected to have a material adverse effect on either Party's rights or obligations under this Agreement.
- (b) Franchisor Defense. Franchisor shall have the first opportunity, at its sole cost and expense, to defend against or settle (provided such settlement shall have no adverse or negative effect whatsoever upon Franchisee) any proceedings before any Governmental Authority initiated by any third parties in respect of or relating to the Camp Margaritaville Intellectual Property as soon as reasonably possible and to initiate, defend and maintain proceedings before the applicable Governmental Authority against third parties as required to protect and defend Franchisor's interest in and to the Camp Margaritaville Intellectual Property in the relevant jurisdiction.
- (c) Franchisee Defense. Regarding a proceeding to enforce or defend the Camp Margaritaville Intellectual Property, the invalidity, infringement, misappropriation of which could materially, adversely impact the Resort, if Franchisor has failed to take commercially reasonable action within 30 days of notice or within 5 days if injunctive relief is entered against Franchisor or Franchisee, after Franchisor becomes aware of any such infringement, misappropriation or proceeding in respect of or relating to the Camp Margaritaville Intellectual Property, which infringement, misappropriation or proceedings would on a commercially reasonable basis be expected to have a material adverse effect on Franchisee's rights under this Agreement, Franchisee may at Franchisor's sole cost and expense and upon delivery of written notice to Franchisor, initiate and maintain proceedings before the applicable Governmental Authority in its own name and/or the name of Franchisor or any Franchisor Affiliate and join Franchisor and/or any Franchisor Affiliate as a party thereto or participate in the defense and settlement
Source: Item 23 — RECEIPTS (FDD pages 72–406)
What This Means (2025 FDD)
According to Camp Margaritaville's 2025 Franchise Disclosure Document, both the franchisee and franchisor have obligations regarding the notification and defense of legal proceedings related to intellectual property. If either party becomes aware of any infringement or misappropriation of Camp Margaritaville Intellectual Property, they must promptly notify the other party in writing. This notification is required if the infringement, misappropriation, or related proceedings before a Governmental Authority could reasonably be expected to have a material adverse effect on either party's rights or obligations under the Franchise Agreement.
The franchisor has the first opportunity to defend against or settle any proceedings before any Governmental Authority related to the Camp Margaritaville Intellectual Property. This defense or settlement is at the franchisor's sole cost and expense, provided that any settlement does not negatively affect the franchisee. The franchisor is also responsible for initiating, defending, and maintaining proceedings against third parties to protect its interest in the Camp Margaritaville Intellectual Property.
However, if the franchisor fails to take commercially reasonable action within 30 days of notice (or within 5 days if injunctive relief is entered against either party) after becoming aware of any infringement, misappropriation, or proceeding that could materially and adversely impact the Resort, the franchisee has the right to act. In this case, the franchisee may, at the franchisor's sole cost and expense, initiate and maintain proceedings before the applicable Governmental Authority in its own name and/or the name of the franchisor or any Franchisor Affiliate. The franchisee can also join the franchisor and/or any Franchisor Affiliate as a party or participate in the defense and settlement of such proceedings, after providing written notice to the franchisor.