For a Carls franchise, what is the permitted use of the Franchised Restaurant?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
re, as described in Item 1. All of the businesses that our affiliates and their franchisees operate may solicit and accept orders from customers near your business. Because they are separate companies, we do not expect any conflicts between our franchisees and our affiliates' franchisees regarding territory, customers and support, and we have no obligation to resolve any perceived conflicts that might arise.
ITEM 13 TRADEMARKS
For Carl's Jr. Restaurant franchisees, we grant you the right to operate a restaurant under the name "Carl's Jr." and to use our other current or future trademarks that we designate in the operation of your Franchised Restaurant. By trademarks, we mean trade names, trademarks, trade dress, service marks, logos, insignias, slogans, emblems, symbols, designs and any combination of these or any other indicia of source used to identify and distinguish the Carl's Jr. brand (our "Proprietary Marks"). We own all right, title and interest in and to the Proprietary Marks and you will only have such rights to use the Proprietary Marks as granted to you in the Franchise Agreement.
Our Proprietary Marks include both registered and unregistered marks. Registered marks are marks that have been registered with the United States Patent and Trademark Office ("USPTO") and enjoy the protections of federal registration. Unregistered marks may include short term product marks (LTOS or similar promotions), trade dress, or other marks that, while not registered, are protected by common law based upon our use of the marks.
Source: Item 16 — RESTRICTIONS ON WHAT THE FRANCHISEE MAY SELL (FDD page 61)
What This Means (2024 FDD)
According to the 2024 FDD, Carls grants franchisees the right to operate a restaurant under the "Carl's Jr." name and to use their designated trademarks for the Franchised Restaurant. These trademarks include trade names, trade dress, service marks, logos, insignias, slogans, emblems, symbols, designs, and any other indicators that distinguish the Carl's Jr. brand.
The FDD specifies that franchisees may only sell or distribute products identified by these Proprietary Marks from the Franchised Location and cannot use any other distribution methods unless participating in online ordering and delivery programs designated by Carls. While there are no geographic restrictions on soliciting customers, Item 13 of the FDD contains Internet restrictions that franchisees must adhere to.
Carls reserves all rights to the Carl's Jr. System not expressly granted to the franchisee and retains the right to merchandise and distribute goods and services identified by the Proprietary Marks through any method or channel of distribution, including the Internet. This means that while franchisees can operate a Carl's Jr. restaurant, Carls maintains control over the brand and its broader distribution strategies.