Does the Canine Dimensions franchisee's obligation not to compete after termination or expiration of the agreement allow the franchisor to seek injunctive relief if breached?
Canine_Dimensions Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee acknowledges that a breach of this Agreement by Franchisee, which relates to any of the matters set out below, will cause irreparable harm to Franchisor for which monetary damages are an inadequate remedy. Therefore, in addition to any other remedies Franchisor has under this Agreement,
Franchisor is entitled to seek and obtain the entry of temporary and permanent injunctions and orders of specific performance enforcing the provisions of this Agreement with respect to: (i) the Marks; (ii) the System; (iii) the obligations of Franchisee upon termination or expiration of this Agreement, including but not limited to Franchisee's covenant not to compete with Franchisor or other System franchisees; (iv) Transfers; (v) Confidential Information; and (vi) any act or omission by Franchisee or Franchisee's employees that: (a) constitutes a violation of any applicable law; (b) is dishonest or misleading to customers of the Franchised Business or other System franchisees; (c) constitutes a danger to the employees or customers of the Franchised Business or to the public; or (d) may impair the good will associated with the Marks or the System. Franchisee is entitled to seek and obtain the entry of temporary and permanent injunctions and orders of specific performance enforcing the provisions of this Agreement as may be available at law or in equity. Neither party is required to post a bond or other security with respect to obtaining injunctive relief.
Source: Item 22 — CONTRACTS (FDD page 36)
What This Means (2025 FDD)
According to Canine Dimensions' 2025 Franchise Disclosure Document, Canine Dimensions can seek injunctive relief against a franchisee for breaching the non-compete obligations after the franchise agreement terminates or expires. The FDD states that a franchisee's breach of the agreement, particularly concerning the non-compete clause, will cause irreparable harm to Canine Dimensions, making monetary damages an insufficient remedy.
Therefore, Canine Dimensions is entitled to seek temporary and permanent injunctions and orders of specific performance to enforce the provisions of the agreement. This includes the franchisee's covenant not to compete with Canine Dimensions or other franchisees within the system. This means that if a franchisee violates the non-compete agreement, Canine Dimensions can go to court to obtain an order preventing the franchisee from continuing the prohibited activities.
Furthermore, neither party is required to post a bond or other security to obtain injunctive relief, which can expedite the process of obtaining an injunction. This clause highlights the importance Canine Dimensions places on protecting its brand, system, and franchisee network from unfair competition, ensuring that franchisees adhere to their post-termination obligations. However, in California, these provisions may not be enforceable under California law.