What actions are considered 'diverting business' from Central Bark Doggy Day Care facilities?
Central_Bark_Doggy_Day_Care Franchise · 2025 FDDAnswer from 2025 FDD Document
- (a) During the Term, you agree not to (and to cause each Restricted Person not to), in any capacity, either directly or indirectly: (i) engage in any Competitive Activity, at any location, whether within or outside the Multi-unit Territory; or (ii) divert or attempt to divert any business or any customers of Central Bark Facilities to any other person or Business Entity, by direct or indirect inducement or otherwise, or do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Marks.
- (b) To the extent permitted by Applicable Law, upon the expiration or termination of this Agreement, or if you make an Assignment, or if any Restricted Person's relationship with you shall cease, then for a period of two (2) years thereafter, you agree not to (and to cause each such Restricted Person not to), (i) either directly or indirectly, engage in any Competitive Activities within the Multi-unit Territory or within ten (10) miles of any Central Bark Facility then existing; or (ii) divert or attempt to divert any business or any customers of Central Bark Facilities to any other person or Business Entity, by direct or indirect inducement or otherwise, or do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Marks.
- (c) The parties have attempted in Sections 8.1(a) and 8.1(b) of this Agreement above to limit your right to compete only to the extent necessary to protect us from unfair competition. The parties hereby expressly agree that if the scope or enforceability of Section 8.1(a) or 8.1(b) of this Agreement is disputed at any time by you, a court or arbitrator, as the case may be, may modify either or both of such provisions to the extent that it deems necessary to make such provision(s) enforceable under Applicable Law. In addition, we reserve the right to reduce the scope of either, or both, of said provisions without your consent, at any time or times, effective immediately upon notice to you. Any period of time specified in this Article 9 will be tolled and suspended for any period of time during which you are in violation of any restrictive covenant of this Agreement or any other agreement with us.
Source: Item 1 — Franchisee shall have paid all Royalty Fees, advertising fund contributions, LAC contributions, amounts owed for purchases by Franchisee from Franchisor, or Franchisor's affiliates, and all other amounts owed to Franchisor, Franchisor's affiliates, and third-party creditors, and shall have submitted to Franchisor all required reports and statements; (FDD pages 106–233)
What This Means (2025 FDD)
According to the 2025 Central Bark Doggy Day Care FDD, franchisees are prohibited from diverting or attempting to divert any business or customers of Central Bark Doggy Day Care facilities to any other person or business entity. This includes doing anything that could harm the goodwill associated with the Central Bark Doggy Day Care brand. This restriction applies during the term of the agreement.
After the agreement expires or terminates, or if the franchisee makes an assignment, the restriction on diverting business continues for two years. During this period, franchisees cannot divert business or customers to other entities or perform actions that harm the brand's goodwill. This post-term restriction applies within the multi-unit territory or within ten miles of any existing Central Bark Doggy Day Care facility.
Central Bark Doggy Day Care includes a clause stating that the non-compete limitations are intended to be only as restrictive as necessary to protect the company from unfair competition. A court or arbitrator can modify the non-compete provisions to make them enforceable under applicable law if their scope or enforceability is disputed. Central Bark Doggy Day Care also retains the right to reduce the scope of these provisions at any time with notice to the franchisee.
For a prospective franchisee, these non-compete and business diversion clauses are significant. They limit the franchisee's ability to engage in competitive activities or attract Central Bark Doggy Day Care customers to other ventures, both during the franchise term and for a period after the franchise agreement ends. Franchisees should carefully consider these restrictions and how they might impact their future business opportunities.