Under what circumstances is a Camp Margaritaville party required to indemnify the other party?
Camp_Margaritaville Franchise · 2025 FDDAnswer from 2025 FDD Document
y to take any action which would affect the ownership of the Margaritaville Intellectual Property or Margaritaville Artwork by Licensor.
- b. Licensee agrees that it shall, at no time during the Term or thereafter, use or authorize the use of any trademark, trade name or other designation identical with or confusingly or substantially similar to any of: (i) the Margaritaville Intellectual Property, (ii) or any mark uniquely associated with Licensor.
- c. When requested by Licensor, Licensee agrees to assist Licensor (and its Affiliates) in connection with any intellectual property claims dealing with the enforcement of
Licensor's (and its Affiliates') rights in the Margaritaville Intellectual Property or Margaritaville Artwork that Licensor (and its Affiliates) may choose to bring. Licensor agrees to reimburse Licensee's reasonable out-of-pocket expenses incurred in providing such assistance. With respect to any intellectual property actions not caused by any breach of this Agreement by Licensee that Licensor may choose to bring, Licensor shall, at Licensor's cost and expense, employ counsel of its own choice to direct the handling of such claims and any settlement thereof. Licensor shall be entitled to receive and retain all amounts awarded as damages, profits or otherwise in connection with such suits.
8. Indemnification.
- a. Indemnification by Licensee. Licensee shall defend, indemnify, and hold Licensor, and its Affiliates, and their respective officers, directors, employees, agents, attorneys, heirs, members, successors, parents and assigns of the foregoing, harmless against and in respect of any and all losses arising from any and all third-party actions, suits, proceedings, demands, assessments, judgments, costs and expenses (including reasonable attorneys' fees and expenses) arising out of Licensee's use or sublicense of the Margaritaville Intellectual Property, including, without limitation, injury, wrongful death, negligence or battery claims by customers of the Resort, except claims by a third party, based on facts or circumstances not otherwise disclosed in Schedule 2 of the Trademark Agreements, that use of the Margaritaville Intellectual Property pursuant to the terms of this Agreement infringes or otherwise violates a third party's intellectualproperty rights
- b. Indemnification by Licensor. Licensor shall defend, indemnify and hold Licensee and its officers, directors, employees, agents, attorneys, members, successors, parents and assigns harmless against and in respect of any and all losses arising from any and all third-party actions, suits, proceedings, demands, assessments, judgments, costs and expenses (including reasonable attorneys' fees and expenses) based on facts not otherwise disclosed in Schedule 2 of the Trademark Agreements, that (i) use of the Sub-Licensed Marks according to this Agreement, which are either registered or allowed for registration in the class of goods or services of the infringement or alleged infringement, infringes or otherwise violates such third party's intellectual property rights; for purposes of this Subsection, "allowed for registration" means approved by the United States Patent and Trademark Office and past any opposition period without being opposed; (ii) the use of the Sub-Licensed Trade Dress and Margaritaville Artwork which are provided by or on behalf of Licensor and used in accordance with this Agreement infringe or otherwise violate such third party's intellectual property rights.
- c. Notification.
Source: Item 23 — RECEIPTS (FDD pages 72–406)
What This Means (2025 FDD)
According to Camp Margaritaville's 2025 Franchise Disclosure Document, both the licensee (franchisee) and the licensor (franchisor) have specific obligations to indemnify the other party under certain circumstances. The franchisee must defend, indemnify, and hold the franchisor harmless from losses arising from third-party actions related to the franchisee's use of the Margaritaville Intellectual Property. This includes claims related to injury, wrongful death, negligence, or battery claims made by resort customers. However, this indemnification does not apply to claims based on facts or circumstances not disclosed in Schedule 2 of the Trademark Agreements, specifically if the use of the Margaritaville Intellectual Property infringes on a third party's intellectual property rights.
Conversely, the franchisor must defend, indemnify, and hold the franchisee harmless from losses arising from third-party actions based on facts not disclosed in Schedule 2 of the Trademark Agreements. This obligation applies if the use of the sub-licensed marks, which are either registered or allowed for registration, infringes on a third party's intellectual property rights. It also applies to the use of sub-licensed trade dress and Margaritaville Artwork provided by the franchisor and used according to the agreement, if such use infringes on a third party's intellectual property rights.
These indemnification clauses are designed to protect both parties from potential liabilities arising from the use of intellectual property. The schedule 2 exceptions are important because they allocate risk based on what information is known at the time of the agreement. Franchisees should carefully review Schedule 2 of the Trademark Agreements to understand the scope of these exceptions and the potential liabilities they might face. Furthermore, it's important to note that the franchise agreement stipulates that punitive damages and jury trials are waived except for indemnification obligations for third-party claims.