What must a Casiola franchisee do to ensure they are indemnified against trademark infringement claims?
Casiola Franchise · 2024 FDDAnswer from 2024 FDD Document
We will protect your right to use the Licensed Marks and other related rights and protect you against claims of infringement and unfair competition related to the Licensed Marks, provided that you use the Licensed Marks in accordance with the terms of your Franchise Agreement, as designated by us in the Manuals, and otherwise, as we instruct you. We will indemnify you against direct damages for trademark infringement in a proceeding arising out of your use of the Licensed Marks, provided your use of the Licensed Marks comply with the terms of your Franchise Agreement, the Manuals, our written instructions, and that you have timely notified us of the claim, have given us sole control of the defense and settlement of the claim, and you are in compliance with your Franchise Agreement. If we defend the claim, we have no obligation to indemnify or reimburse you with respect to any fees or disbursements of any attorney that you retain.
Source: Item 13 — TRADEMARKS (FDD pages 32–34)
What This Means (2024 FDD)
According to Casiola's 2024 Franchise Disclosure Document, Casiola will protect a franchisee against trademark infringement claims if the franchisee adheres to specific conditions. Casiola requires the franchisee to use the licensed marks in accordance with the terms outlined in the Franchise Agreement, the manuals, and any written instructions provided by Casiola.
To be indemnified, the franchisee must also promptly notify Casiola of any trademark infringement claims. Furthermore, the franchisee must allow Casiola to have sole control over the defense and settlement of the claim. Compliance with the Franchise Agreement is also a prerequisite for indemnification. If Casiola defends the claim, they are not obligated to cover the fees or disbursements of any attorney retained by the franchisee.
In the event a third party successfully claims superior rights to the licensed marks, Casiola has the right to modify or replace the marks. In this case, the franchisee is obligated to use the modified marks as directed by Casiola. Casiola's sole obligation in such a scenario is to reimburse the franchisee for the direct, out-of-pocket costs incurred in complying with the required changes, such as alterations to signage and replacement of marketing materials, provided these costs are documented to Casiola's satisfaction.