Regarding the Olo Licensed Applications used by Carls franchisees, who owns the intellectual property and proprietary rights?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
- 3.2. Proprietary Rights. As between Operator and Olo, Operator hereby acknowledges and agrees that Olo owns all right, title and interest, including all copyrights and other intellectual property and proprietary rights, in and to the Licensed Applications, and all custom developed documents, designs, computer programs, computer systems, computer documentation and other work product authored or prepared by Olo upon the request of Customer or otherwise arising out of the Services (collectively, "Olo IP").
- 3.3. Trademark License. Operator acknowledges that the ownership, right, title and interest in and to Olo's trademarks rests with Olo and agrees that it will do nothing inconsistent with such ownership. Operator may use the slogan "Skip the Line®" in marketing materials and store displays in reference to the order ahead program utilizing the Licensed Applications; provided however that any display of such slogan clearly denotes the slogan as a registered trademark of Olo.
Source: Item 23 — RECEIPTS (FDD pages 80–480)
What This Means (2024 FDD)
According to Carls's 2024 Franchise Disclosure Document, Olo owns all intellectual property and proprietary rights related to the Licensed Applications. Specifically, Olo retains ownership of all rights, titles, and interests, including copyrights, in the Licensed Applications, custom-developed documents, designs, computer programs, systems, documentation, and other work products created by Olo at the customer's request or arising from the services provided.
This means that while Carls franchisees (referred to as "Operators" in the agreement with Olo) are granted a license to access and use the Olo Licensed Applications, they do not acquire any ownership rights. The license is non-exclusive, non-sublicensable (except as permitted), and non-transferable (except under specific conditions outlined in Section 10.4 of the agreement). Franchisees are only permitted to use the Licensed Applications according to the terms and conditions set forth in their agreement with Olo and any applicable addendums.
Carls franchisees acknowledge that Olo's trademarks also remain the property of Olo, and franchisees must adhere to Olo's guidelines when using these trademarks, such as the slogan "Skip the Line®". Franchisees can use the slogan in marketing materials and store displays when referencing the order ahead program that utilizes the Licensed Applications, but they must clearly denote the slogan as a registered trademark of Olo.
This arrangement is typical in franchising, where franchisors often use third-party software or platforms to provide services to franchisees while retaining control over the intellectual property. For a prospective Carls franchisee, this means they will rely on Olo's platform for e-commerce, delivery enablement, and payment solutions but will not have any ownership or control over the underlying technology.