Under what conditions can Carls Jr. intervene in customer complaints and charge the franchisee for the associated costs?
Carls_Jr Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee shall immediately resolve any customer complaints regarding the quality of food or beverages, service and/or cleanliness of the Franchised Restaurant or any similar complaints. When any customer complaints cannot be immediately resolved, Franchisee shall use best efforts to resolve the customer complaints as soon as practical and shall, whenever feasible, give the customer the benefit of the doubt. If CJR, in its sole discretion, determines that its intervention is necessary or desirable to protect the System or the goodwill associated with the System, or if CJR, in its sole discretion, believes that Franchisee has failed adequately to address or resolve any customer complaints, CJR may, without Franchisee's consent, resolve any complaints and charge Franchisee an amount sufficient to cover CJR's reasonable costs and expenses in resolving the customer complaints, which amount Franchisee shall pay CJR immediately on demand.
Source: Item 22 — CONTRACTS (FDD pages 75–76)
What This Means (2025 FDD)
According to Carls Jr.'s 2025 Franchise Disclosure Document, franchisees are expected to immediately resolve customer complaints regarding food quality, service, or cleanliness. Franchisees should exert their best efforts to resolve complaints quickly, giving the customer the benefit of the doubt whenever possible.
However, Carls Jr. reserves the right to intervene in customer complaints under specific circumstances. If Carls Jr. determines, in its sole discretion, that intervention is necessary to protect the franchise system's integrity or goodwill, or if Carls Jr. believes the franchisee has not adequately addressed a complaint, Carls Jr. may step in to resolve the issue directly.
In such cases, Carls Jr. can resolve the complaints without the franchisee's consent and charge the franchisee for the reasonable costs and expenses incurred during the resolution process. The franchisee is then obligated to pay this amount to Carls Jr. immediately upon demand. This provision highlights the importance of franchisees proactively and effectively managing customer complaints to avoid potential intervention and associated costs from Carls Jr.