For Caption By Hyatt, does 'Brand Damages' include lost opportunity costs?
Caption_By_Hyatt Franchise · 2025 FDDAnswer from 2025 FDD Document
"Brand Damages" means lost Royalty Fees, lost System Services Charges, lost market penetration and goodwill, loss of Hotel System representation in the Hotel's market area, confusion of national accounts and individual customers, disadvantage in competing for national accounts and other types of bookings for Brand Hotels, lost opportunity costs, and expenses that Hyatt will incur in developing or finding another franchisee to develop another Brand Hotel in the Hotel's market area.
Source: Item 22 — Contracts (FDD page 85)
What This Means (2025 FDD)
According to the 2025 Caption By Hyatt Franchise Disclosure Document, Brand Damages do include lost opportunity costs. Specifically, Brand Damages are defined as various financial and reputational harms that Caption By Hyatt could suffer if a franchise agreement is terminated early.
These damages include not only lost Royalty Fees and System Services Charges, but also less tangible harms such as lost market penetration and goodwill. The definition explicitly includes loss of Hotel System representation in the Hotel's market area, potential confusion of national accounts and individual customers, and disadvantages in competing for national accounts.
Importantly, the definition of Brand Damages also encompasses expenses that Caption By Hyatt will incur in finding another franchisee to develop another Brand Hotel in the Hotel's market area. This broad definition suggests that Caption By Hyatt aims to recover all potential losses resulting from an early termination, covering both direct financial losses and indirect costs associated with re-establishing the brand's presence in the affected market.