What rights does the Canine Dimensions franchisor have regarding the marks and the goodwill associated with them?
Canine_Dimensions Franchise · 2025 FDDAnswer from 2025 FDD Document
- 7.3.2 As between the parties, Franchisor has the exclusive right and interest in and to the Marks and the goodwill associated with and symbolized by them. Franchisee's use of the Marks pursuant to this Agreement does not give Franchisee any ownership or other interest in or to the Marks, except the limited, non-exclusive license granted by this Agreement. Any and all goodwill arising from Franchisee's use of the Marks in its franchised operation under the System shall inure solely and exclusively to Franchisor's benefit, and upon expiration or termination of this Agreement and the license herein granted, no monetary amount shall be assigned as attributable to any goodwill associated with Franchisee's use of the System or the Marks.
- 7.3.3 The right license to use the Marks granted to Franchisee is non-exclusive, and that Franchisor has and retains the following rights, among others:
- (a) To use the Marks itself in connection with selling products and services;
- (b) To grant other licenses for the Marks in addition to those licenses already granted to existing franchisees;
- (c) To develop and establish other systems using the same or similar Marks, or any other Marks, and to grant licenses or franchises thereto without providing any rights in them to Franchisee.
- 7.3.4 Franchisor reserves the right to substitute different Marks for use in identifying the System and the businesses operating thereunder if Franchisor's currently owned Marks no longer can be used, or if Franchisor, in its sole discretion, determines that substitution of different Marks will be beneficial to the System. In the event of a change in or substitution of any Mark, Franchisor shall not be obligated to reimburse Franchisee for any costs incurred by Franchisee related to such change or substitution. Franchisee waives any claim arising from or relating to any Mark change, modification or substitution. Franchisor will not be liable to Franchisee for any expenses, losses or damages sustained by Franchisee as a result of any Mark addition, modification, substitution or discontinuation, except as provided in this Agreement. Franchisee covenants not to commence or joint in any litigation or other proceeding against Franchisor for any of these expenses, losses or damages.
Source: Item 22 — CONTRACTS (FDD page 36)
What This Means (2025 FDD)
According to Canine Dimensions' 2025 Franchise Disclosure Document, the franchisor retains significant rights regarding its trademarks (the "Marks") and the goodwill associated with them. Canine Dimensions states that it has the right to use and license others to use the Marks and will take necessary steps to protect their ownership and validity. The franchisee's right to use the Marks is limited to what is authorized in the franchise agreement, and unauthorized use is considered infringement.
As stated in the FDD, Canine Dimensions retains the exclusive right and interest in the Marks and the goodwill they represent. The franchisee's use of the Marks does not grant them any ownership, only a limited, non-exclusive license. All goodwill arising from the franchisee's use of the Marks benefits Canine Dimensions exclusively. Upon termination or expiration of the franchise agreement, no monetary amount will be assigned to any goodwill associated with the franchisee's use of the Marks.
Canine Dimensions also has the right to use the Marks themselves, grant other licenses for the Marks, and develop other systems using the same or similar Marks without providing any rights to the franchisee. Canine Dimensions reserves the right to substitute different Marks if the current ones can no longer be used or if a substitution is beneficial to the system. The franchisee is not entitled to reimbursement for costs related to any changes or substitutions of the marks.
In practical terms, this means a Canine Dimensions franchisee must adhere strictly to the franchisor's guidelines for using the brand's trademarks. They cannot claim any ownership of the brand or its reputation, and all the goodwill generated through their business activities ultimately benefits the franchisor. Upon termination of the franchise agreement, the franchisee loses all rights to use the Canine Dimensions Marks and cannot claim any financial stake in the goodwill they helped create during the term of their agreement.