To receive indemnification from Carbones Pizzeria, must I tender the defense of the trademark claim to them?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
We will also take reasonable steps to protect your rights to use our principal trademarks and protect you against claims of infringement or unfair competition in their use. We will indemnify you against liability to third parties resulting from claims by third parties that your use of our principal trademarks infringe upon the rights of third parties but only if such use is in accordance with the terms of the Franchise Agreement (including any requirement imposed by us to modify or discontinue the use of any name or mark and/or use one or more additional or substitute names or marks). As a condition to indemnification, you must provide notice to us of any such claim within 10 days and you must tender the defense of the claim to us. If we accept the tender of the defense, we have the right to manage the defense of the claim, including the right to compromise, settle or otherwise resolve the claim and to determine whether to appeal a final determination of the claims.
Source: Item 13 — TRADEMARKS (FDD pages 21–22)
What This Means (2025 FDD)
According to the 2025 FDD, Carbones Pizzeria will indemnify franchisees against liability to third parties resulting from trademark infringement claims, but only if the franchisee's use of the trademarks is in accordance with the terms of the Franchise Agreement. As a condition to indemnification, the franchisee must provide notice to Carbones Pizzeria of any such claim within 10 days and tender the defense of the claim to them. If Carbones Pizzeria accepts the tender of the defense, they have the right to manage the defense of the claim, including the right to compromise, settle, or otherwise resolve the claim and to determine whether to appeal a final determination of the claims.
This means that if a franchisee is sued for trademark infringement related to their use of Carbones Pizzeria's trademarks, they must promptly notify Carbones Pizzeria within 10 days and offer them the opportunity to take over the legal defense. This is a common requirement in franchise agreements, as it allows the franchisor to control the defense of their trademarks and ensure a consistent legal strategy.
By tendering the defense, the franchisee gives Carbones Pizzeria the right to manage the legal proceedings, including making decisions about settlement or appeals. However, this also means that the franchisee may have to relinquish some control over the defense of the lawsuit. It is important for franchisees to understand these conditions and ensure they comply with the Franchise Agreement to be eligible for indemnification.