factual

What restrictions does CJR impose on a Carls Jr. franchisee's use of Consumer Information?

Carls_Jr Franchise · 2025 FDD

Answer from 2025 FDD Document

sed Restaurant opens, Franchisee agrees to enter into the OLO Authorized Operator Agreement with Olo, Inc. Franchisee further agrees to enter into any participation agreement required with CJR's designated delivery providers at the same time (currently, the approved delivery providers are Uber Eats, Door Dash, and GrubHub). Unless CJR provides its prior written consent, Franchisee agrees that it will not provide its own delivery service or use its employees to deliver orders to Franchisee's customers.

O. Customer Satisfaction Programs

In order to (among other things) maintain and enhance the goodwill associated with the Proprietary Marks, the System and each Carl's Jr. Restaurant, Franchisee agrees to participate in programs initiated to verify customer satisfaction and/or Franchisee's compliance with all operational and other aspects of the System, including (but not limited to) secret shoppers, customer survey, or other Quality Assurance ("QA") or similar programs as CJR may require. CJR will share the results of these programs, as they pertain to the Franchised Restaurant, with Franchisee. Franchisee will reimburse CJR for all costs related to the Franchised Restaurant associated with any and all of these programs.

P. Consumer Information

Franchisee may only use Consumer Information (as defined below) to the extent necessary to perform Franchisee's obligations under this Agreement during the term hereof and subject to such instructions and restrictions as CJR may from time to time impose and in compliance with all data privacy, security and other applicable laws. "Consumer Information" means any identifiers (including name, address, phone numbers, usernames, birthdates and e-mail addresses), sales, transaction, loyalty and payment history, and all other information about or related to any customer or prospective customer, including any information deemed "personal information" or "personal data" under applicable law. As used in this Agreement, the term "customer" refers to any person or entity (i) whose information is collected by any CJR system or application or included in any consumer or customer database, file or system owned or controlled by CJR, its parent, subsidiary or affiliate companies; (ii) who is included on any marketing or customer lists Franchisee develops or uses or any customer information generally collected and saved for any reason; (iii) who has purchased, purchases or intends to purchase products or services online, through an CJR application, or at the Franchised Restaurant; or (iv) who has been solicited to purchase any products or services at the Franchised Restaurant. CJR may use the Consumer Information as CJR deems appropriate, including sharing it with CJR's affiliates.

CJR owns all Consumer Information and may use the Consumer Information as it deems appropriate (subject to applicable law), including disclosing it to vendors or sharing it with its affiliates for cross-marketing or other purposes. Franchisee may only use Consumer Information for the purpose of operating the Franchised Restaurant to the extent permitted under this Agreement, including the OPM, during the term hereof and subject to such restrictions as CJR may from time to time impose and in compliance with all data privacy, security and other applicable laws. Without limiting the foregoing, Franchisee agrees to comply with applicable law in connection with Franchisee's collection, processing, storage and use of such Consumer Information, including, if required under applicable law, obtaining consents from individuals for CJR's and its affiliates' use of the Consumer Information. Franchisee must comply with all laws and regulations relating to data protection, privacy and security, including data breach response requirements ("Privacy Law(s)"), as well as data privacy and security policies, procedures and other requirements CJR may periodically establish.

Source: Item 22 — CONTRACTS (FDD pages 75–76)

What This Means (2025 FDD)

According to the 2025 Carls Jr. Franchise Disclosure Document, Carls Jr. places several restrictions on how a franchisee can use consumer information. Carls Jr. owns all consumer information and can use it as they see fit, including sharing it with affiliates. The franchisee is only allowed to use consumer information to operate their franchised restaurant, following any restrictions Carls Jr. imposes and in compliance with data privacy laws.

Carls Jr. franchisees cannot sell or share consumer information with third parties for valuable consideration. They must only use the information for specific business purposes outlined in the agreement and within the direct business relationship between the franchisee and Carls Jr. Franchisees are also restricted from combining consumer information received from Carls Jr. with personal information from other sources, except as allowed by privacy laws.

Furthermore, franchisees need express approval from Carls Jr. to allow anyone other than their direct employees to process consumer information, and any subcontracting must be governed by a written agreement with terms at least as restrictive as those in the franchise agreement. Franchisees must also comply with consumer requests, such as deletion or correction of data, as required by privacy laws, and cooperate with Carls Jr. in responding to these requests.

Carls Jr. also requires franchisees to provide all necessary information to demonstrate compliance with their obligations regarding consumer information. Carls Jr. may conduct audits, including manual reviews, automated scans, and technical testing, at least once every twelve months to ensure compliance. Franchisees must notify Carls Jr. immediately of any suspected data breach and cooperate in determining the best way to meet Carls Jr.'s standards and policies pertaining to privacy laws.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.