What intellectual property rights does Chatime grant to the franchisee for conducting the franchised business?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
se by the Chatime Group anywhere in the world.
Franchise Documents means: (a) the Franchise Agreement; (b) the Operations Manual; (c) the Franchisee's lease for the Premises; and (d) any other document produced by the Franchisor from time to time that relates to the occupation of the Premises or the operation and procedure of the Franchised Business, and Franchise Document means any one of the foregoing.
Franchised Business means the Chatime Store Business operated by the Franchisee from the Premises in accordance with the Franchise Documents.
Intellectual Property means the: (a) the Business Names; (b) the Marks; (c) the Confidential Information; (d) the Business System; (e) the Franchise Documents; (f) the Database; (g) the POS Software System; (h) any other forms, documents, patents, patent applications, drawings, discoveries, inventions, improvements, trade secrets, technical data, formulae, computer programs, data bases (but not including the Franchisee Membership Data), know-how, logos, designs, design rights and copyright materials associated with or used in the Franchised Business; (i) existing and future copyright that the Franchisor owns or will own or that is licensed to the Franchisor, in all Manuals, materials or other original works relating to the Business System; (j) the Franchisor's Internet domain name and any Internet home page that the Franchisor may develop; (k) any social media sites operated by the Franchisor using the Franchisor's Marks including, but not limited to, Facebook, Instagram, Twitter, YouTube, LinkedIn and Snapchat; (l) the Franchisor's marketing emblems, logos, promotional materials, advertorials, publications and any other materials imparted to the Franchisee by the Franchisor; and (m) the Corporate Image.
Intellectual Property Rights means: (a) patents, copyright, registered and unregistered design rights, registered and unregistered trademarks, rights in know-how and confidential information and all other intellectual and industrial property rights (without limitation); (b) all similar or analogous rights existing under the laws of any country; and (c) all rights to apply for or register such rights.
Manual means the operations manuals and documents produced by the Franchisor and accessible via the internet specifying in greater detail aspects of the Business System and the Franchisor's standards as amended from time to time.
Marks means the Name, trademarks, service marks, and such other registered or unregistered trade names, trademarks, logos, symbols, internet domain names, web site identifiers, colour schemes, layout and design or items used to identify or promote the Franchised Business by the Franchisor as designated from time to time.
Member means any person who registers as a member of the Franchised Business.
Name means the name "Chatime" and"日出茶太" and includes such other names or Marks that the Franchisor may substitute, amend or vary from time to time.
Permitted Purpose means the operation of the Franchised Business by the Franchisee in accordance with the terms of the Franchise Agreement.
Premises means the location identified for the operation of the Franchised Business in the Franchise Agreement.
Products means the products offered by the Franchised Business or other Chatime Store Businesses.
Restrained Business means a business which is the same as or substantially similar to the Franchised Business, or engaged, concerned or interested in or carrying on any retailing or supplying of products or services the same as or substantially similar to the Products or Services offered by the Franchised Business or other Chatime Store Businesses.
Restraint Area means all or any of the following:
- (a) Within a 25-mile radius of the boundary of the Territory;
- (b) Within a 25-mile radius from the Premises;
- (c) Within a 25-mile radius from the premises of any other Franchisee; and
- (d) Within the Territory.
Restraint Period means during the term of the Covenantor's business or employment relationship with the Franchisee and the Franchised Business, and for a continuous uninterrupted two-year period after the end of the Covenantor's business or employment relationship with the Franchisee and the Franchised Business. The Restraint Period shall be extended during the period in which any of the Relevant Persons (as defined in the Franchise Agreement) are violating the Restraint, and shall continue after any violations have ended so that Franchisor shall receive the benefit of a continuous uninterrupted period of no violations equal to the length of time of the Restraint Period.
Services means the services provided by the Franchised Business or other Chatime Store Businesses.
Software includes: (a) operating systems, word processing, accounting, spread sheeting, database, point of sale software, or other business software; (b) materials on which the software
may be supplied or recorded; (c) materials about the software or terms of use; and (d) upgrades to each of the aforementioned software goods.
Territory means the geographic area specified in the Franchise Agreement.
1. CONFIDENTIAL INFORMATION
- (a) I agree that, I must hold the Confidential Information in strict confidence and must not disclose any of the Confidential Information to any person. I may only use of the Confidential Information for the Permitted Purpose, or as required by law, and not for any other purpose. I must take all necessary and reasonable steps to protect the confidentiality of the Confidential Information. I must inform the Franchisee if I become aware of an actual or suspected breach of this. I must not use the Confidential Information in a way that may be detrimental to the Business System, Network or the other party; or copy or duplicate the Confidential Information unless permitted by this Agreement, the Manual or the other party.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, franchisees are granted the right to use Chatime's intellectual property for the duration of the franchise agreement's initial term. This right is specifically for conducting the franchised business at the designated premises. The intellectual property includes business names, trademarks (the Marks), confidential information, the business system, franchise documents, databases, the POS software system, and various other proprietary items associated with the Chatime business. These rights are limited to the specific premises and the initial term of the agreement, and franchisees cannot operate or grant franchises outside their designated territory.
Chatime retains all rights to the intellectual property, outlets, and the sale of raw materials and other products worldwide. This includes the right to operate or grant others the right to operate outlets under the Chatime brand or other trademarks outside the franchisee's territory. Chatime also reserves the right to distribute and market services or products through special distribution channels, such as airports, train stations, hotels, and other venues, both within and outside the franchisee's territory.
Franchisees are obligated to transfer ownership of any intellectual property they own that is similar or identical to Chatime's intellectual property to Chatime at their own cost. They are also prohibited from registering any similar intellectual property without Chatime's written consent. This ensures that Chatime maintains control over its brand and system, and that franchisees do not create any conflicting or confusing intellectual property. The definition of Corporate Image includes the Names, the Marks, all characters, mascots, logos, product and service ranges, trade dress, signs, advertising and other promotional material.
These stipulations are typical in franchising, as they protect the franchisor's brand and system while allowing franchisees to operate their businesses using established and recognized intellectual property. Prospective franchisees should carefully consider these terms to understand the scope and limitations of the rights they are granted, as well as their obligations regarding intellectual property.