Does Carbones Pizzeria have the right to settle a trademark claim if they accept the tender of defense?
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 Carbones Pizzeria's 2025 Franchise Disclosure Document, if a franchisee's use of the Carbone's Pizza or Carbone's Pizzeria trademarks leads to a third-party claim of trademark infringement, Carbones Pizzeria will indemnify the franchisee, provided the use aligns with the Franchise Agreement. This includes adhering to any requirements to modify or discontinue using a name or mark, or to use additional or substitute names or marks.
However, there are conditions to this indemnification. The franchisee must notify Carbones Pizzeria of any such claim within 10 days of receiving it and must tender the defense of the claim to Carbones Pizzeria. If Carbones Pizzeria accepts the tender of defense, they then have the right to manage the defense of the claim.
This management includes the right to compromise, settle, or otherwise resolve the claim. Carbones Pizzeria also has the authority to determine whether to appeal a final determination of the claim. This means that while Carbones Pizzeria offers protection against trademark infringement claims, they retain control over the legal strategy and final decisions regarding settlement or appeals.