Under what circumstances is information NOT considered 'Confidential Information' or a 'Trade Secret' for a Carvel franchise, even if it would otherwise fall under those definitions?
Carvel Franchise · 2025 FDDAnswer from 2025 FDD Document
The terms "Confidential Information" and "Trade Secret" do not include: (i) information generally known to the public at the time we disclose it to you; (ii) information that becomes known to the public after we disclose it to you, unless it becomes known due to your breach of this Agreement or someone else's breach of a duty to maintain confidentiality; or (iii) information you can prove was within your legitimate and unrestricted possession at the time we disclosed it to you.
Source: Item 23 — Receipts (FDD pages 100–353)
What This Means (2025 FDD)
According to Carvel's 2025 Franchise Disclosure Document, certain information is excluded from the definitions of 'Confidential Information' and 'Trade Secret.' This means that even if information would typically be considered confidential or a trade secret, it will not be treated as such under specific circumstances.
Specifically, information is not considered 'Confidential Information' or a 'Trade Secret' if it meets any of the following conditions: (1) it is generally known to the public at the time Carvel discloses it to the franchisee; (2) it becomes known to the public after Carvel discloses it, unless this occurs due to a breach of the Franchise Agreement by the franchisee or a breach of confidentiality by someone else; or (3) the franchisee can prove they legitimately and unrestricted possessed the information before Carvel disclosed it to them.
This is a fairly standard clause in franchise agreements. It protects franchisees from being penalized for using information that was already publicly available or that they already knew before signing the agreement. However, the burden of proof falls on the franchisee to demonstrate they had prior legitimate possession of the information, which may require maintaining thorough records.