If Chatime wishes to register intellectual property rights in a franchisee's improvements, and the franchisee is the owner, what actions must the franchisee take upon request?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
- (3) If Franchisor wishes to register the intellectual property rights in any of Franchisee's Improvements and Franchisee is the owner, or a necessary applicant for that registration, Franchisee must immediately upon the request by Franchisor apply in Franchisee's own name for registration and then sign all documents and deeds, perform all acts and do all things necessary to assign that registration or application to Franchisor or its nominee.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, if a franchisee owns intellectual property rights to improvements made to the Chatime system, and Chatime wants to register those rights, the franchisee has specific obligations. Upon Chatime's request, the franchisee must immediately apply for registration of the intellectual property in their own name.
Following the application, the franchisee is required to sign all necessary documents and deeds. They must also perform all actions and complete all tasks to assign the registration or application to Chatime or its designated nominee. This ensures that Chatime can secure the intellectual property rights to the franchisee's improvements.
This clause highlights the importance of intellectual property within the Chatime franchise system. While franchisees may develop improvements, Chatime retains the right to control and register the intellectual property associated with those improvements. This is a fairly standard practice in franchising, as it allows the franchisor to maintain consistency and protect the brand's intellectual property across all franchise locations.