What is the geographical scope of the non-compete agreement for a Card My Yard franchisee after termination?
Card_My_Yard Franchise · 2025 FDDAnswer from 2025 FDD Document
- b. Directly or indirectly, for yourself or through, on behalf of, or in conjunction with any other person, persons, partnership, corporation, limited liability company, or other association or entity, own, maintain, operate, engage in or have any financial or beneficial interest in, advise, assist or make loans to, any business which is the same as or similar to a Card My Yard business (including any business that offers yard greeting services or other celebratory display items or services of any kind, including but not limited to, balloon displays, lighted displays, etc.) and which is, or is intended to be, located within the United States, its territories or commonwealths, or any other country, province, state or geographic area in which we or our Affiliates have used, sought registration of or registered the Marks or similar marks or operate or license others to operate a business under the Marks or similar marks; provided that during the two year-period following termination, expiration or transfer of the Franchise Agreement, the non-compete restrictions shall be limited to operations: (i) at the Franchise Location, (ii) within the Protected Area, (iii) within a twenty-five (25)-mile radius of the Franchise Location, or (iv) within a twenty-five (25)-mile radius of any Card My Yard business then in existence or under construction.
Source: Item 23 — RECEIPTS (FDD pages 84–259)
What This Means (2025 FDD)
According to Card My Yard's 2025 Franchise Disclosure Document, a franchisee is restricted from engaging in any competitive business after the termination, expiration, or transfer of their Franchise Agreement. This restriction applies to any business that is the same as or similar to a Card My Yard business, including those offering yard greeting services or other celebratory display items.
The geographical scope of this non-compete is extensive, initially covering the entire United States, its territories, commonwealths, and any other country, province, state, or geographic area where Card My Yard or its affiliates have used, sought registration of, or registered their Marks. However, the document specifies that for a two-year period following termination, expiration, or transfer, the non-compete restrictions are limited to:
(i) the Franchise Location, (ii) the Protected Area, (iii) within a twenty-five (25)-mile radius of the Franchise Location, or (iv) within a twenty-five (25)-mile radius of any Card My Yard business then in existence or under construction. This means that while the initial restriction is broad, it becomes more localized to the franchisee's immediate business environment for a period of two years after the agreement ends. This localized restriction aims to protect Card My Yard's existing market presence and prevent former franchisees from directly competing in areas where the brand has established operations.